A Purchase Order (PO) is usually created by adopting what?

A Purchase Requisition is a formal request for goods or services that an organization requires. It is the first step in the procurement process, where a department identifies a need and requests the purchasing department to take action. Once the Purchase Requisition is approved, it serves as the basis for creating a Purchase Order (PO).

This connection is crucial because the PO is then generated based on the details provided in the Purchase Requisition, such as the quantity, description of the goods, and delivery requirements. Therefore, understanding that a Purchase Requisition initiates the procurement process is key to grasping how POs are created.

In contrast, the other options refer to different processes. Goods Movement deals with the physical movement of inventory within an organization but does not initiate the procurement cycle. A Maintenance Order is related to work orders for maintenance tasks, while a Purchase Order itself is an output of this process rather than a source. Hence, the Purchase Requisition is vital in establishing the need that eventually leads to the creation of a Purchase Order.