Oracle Purchasing provides the line type feature so that you can clearly differentiate orders for goods from those for services or outside processing. In addition, the services related line types support a broad range of service categories including general business services, consulting services, and contingent labor.

Usage
Requestors and buyers generally order both goods and services by quantity. You order the number of items you need in a specific unit of measure and at a given price. For instance, a buyer could order 10 computer terminals at a price of $1500 each. Later, the receiving agent records the receipt of one crate of 5 terminals. The accounts payable department receives a bill for 5 terminals, and matches the invoice against the original purchase order. Sometimes, you also need to order services in the same way. For example, you purchase 40 hours of product training at a rate of $40 per hour. You simply record the hours of training ordered and the price per hour. Once you receive the training, you record the hours received.

However, you sometimes order services by amount rather than by quantity. For example, a project manager orders $10,000 of consulting services to install a local area network. In this case, the buyer only needs to record the total amount of the service. When half of the work is complete, the project manager records a receipt of $5000. The consulting firm may send an invoice for the complete amount of the service, or it may send partial invoices. In either case, the accounts payable department must match the invoice to the original purchase order or receipt by amount.

Purchasing provides you with the features you need to order both goods and services. You should be able to:
• Create your own purchasing document line types. For each line type, you should be able to specify the value basis: amount or quantity. If you have implemented Oracle Services Procurement, you have the additional value basis of fixed price
or rate. For both amount and quantity based line types, you can specify default values for category, unit of measure, and whether you require receipt. For quantity based lines, you can specify whether the line type is used for outside processing.
• Create a purchasing document with any combination of line types you need.
• AutoCreate purchase order lines from your requisition lines, grouping requisition lines for the same line type and item onto
the same purchase order lines.
• Create services purchase order lines by selecting a fixed price or rate based line type, category, description, and amount for the line.
• Create amount–based purchase order lines by selecting an amount–based line type, category, item description, and total
amount for the line.

Defining Line Types
Use the Line Types window to define and update line types.

1. Enter the Name and Description of the line type.

2. Enter the Value Basis for the line type.
Amount: Receive items by amount. You cannot change the unit of measure and unit price on purchasing document lines.
Fixed Price: If Oracle Services Procurement is implemented, enter services by amount only. Receive items by amount. You cannot change the unit of measure and unit price on purchasing document lines.
Quantity: Receive items by quantity. Outside Processing line types must have this value basis.
Rate: If Oracle Services Procurement is implemented, enter services by rate (price) and amount. Receive items by amount.
Attention: You can not change line type attributes after transactions have been created for that line type.

3. Enter the Purchase Basis for the line type.
Goods: For quantity value based line types. (Quantity)
Services: For amount and fixed price based line types.(Amount)
Temp Labor: If Oracle Services Procurement is implemented, for fixed price and rate based line types.

4. Enter the default purchasing Category for items with this line type.
You can override this purchasing category on purchasing document lines.

5. Select Receipt Required if you want this as the default on your purchasing document shipments with this line type. You can overrule the default when you enter the shipment.

6. Enter the default Unit of measure for items with this line type. You must enter a default unit when you use the Amount value basis for your line type. You can override this unit of measure on your purchasing document lines only when you use non-Outside Processing line types with Quantity value basis.
If you use the Amount value basis, you may want to choose your functional currency as the unit of measure. For example, if your functional currency is US dollars, you may want to define a unit of measure USD that you can use for your line types with the Amount value basis.
If Oracle Services Procurement is implemented, line types with a rate value basis the unit of measure class can be restricted by the setting of the profile PO: UOM Class for Temp Labor Service.

7. Enter the default Unit Price for items with this line type. Purchasing automatically enters a unit price of 1 when you use the Amount value basis and prevents you from updating this price when you create your line type. You can override this unit price on your purchasing document lines only when you use line types with Quantity value basis.

8. Select Outside Processing to restrict this line type to purchasing outside processing. Also, when you use an outside processing line type on a purchasing document, your choices for the item are limited to outside processing items. You can select this check box only if the value basis is Quantity and if you are using Work in Process.