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BOM

Routing

Oh

25 Setup -1h @ 20
25 Labour -3h @ 20
70 Machine - 4 hr@25

120

20 M/oh
60 Labout/Oh
100 Machine/oh
Admin/oh

180

MC
AC
OH

120
180
200

Total Stand cost

500

30
20
75
75

200

650

25%
25%
75%
25%

45
15
60
TOPICS TO BE COVERED Finished
Enterprise structure
Cost Element
Cost Centre
PC
MTC
COPA
FI-CO Reconciliation
Tables

1530
390
285
675

MM, Movement types


Intergration
500
175
675

170
155
185
140
650

Revised

CO Customization
Reconcilatio Ledger
Cost Center Accounting
CC Create
CC Grp
Standard Hierarchy
CC Categories

SKF
Activity Type
Activity Type Grp
CC Planning
Planning layout to be created
Cost and activity inputs
Activity and output price
Allocation Methods
Assessment
Dsitribution
Periodic Reposting
Indirect activity allocation
direct activity allocation
Execute Assesment Cycle

Cost Element ACC


Primary Cost Element
Secondary Cost Element
Primary Cost element Categ.
1
11
12
22

Secondary Cost Elements Catg.


21
31
41
42
43
Interal Order
order created for the project
Design & Development order
R&D order
Equipment Order
Order Categories

IO Creation
Actual Settlement Order
Settlement Profile
Allocation Structure

Source Structure

PA Transfer Structure

COPA PLANNING

In COPA Planning we can do both so planning (sales quantity planning) revenue & expenditure planning at the segme
The planning of income & expenditure will be used in reporting and helpful to analyze between plan & actual values.
Planning level

Planning package
Planning Methods
Parameter set
Planning Layout

Costing based Vs Account based COPA

Accountng based PA is used to Reconcile


costs & Financial Accounting at any time using
Accounts. Cost of sales is posted to
Profitability Analysis at the time of Goods
Issue. This method uses Cost & Revenue
elements which gives unified structure for all
accounting...

Costing based PA Value Fields used to group


Cost & Revenue elements. Here the data is
always up to date. For preliminaty Profit
analysis standard costs will be used to valuate
Cost of Sales. Costing based uses Cost of
Sales method

1. Account based copa uses transaction tables


(COEP, BSEG) and hence affects
performance of CO transactions.CBC takes
values from CE1XXXX to CE4XXXX tables.
XXXX means Operating Concern name.

2. Estimated / Statistical values not possible in


ABC, say, calculating frieght upon invoice on a
thumb rule basis to have better view of
profitability per customer.. no valuation
strategy in Accounts based COPA..

3. Reports based on line items not possible in


ABC.. possible in CBC.

4 Actual Top Down distribution only available in


CBC not in ABC .
5. Revaluation of actual data to plan data is
not available in ABC

6. No key figure schemes are available in ABC

7. In ABC, settlement cost elements are used


to settle values to prof segments unlike value
fields in CBC

T-code
OKKP
KALA
TABLE
KS01
KSH1
OKEON
Production , Administration
You allow activity type PHR (production hours) to be planned on all cost centers
with category P (production).
This means the activity type cannot be planned on an administration cost center
by mistake.

KK01
KL01
KLH1

KP06
KP26

receiving CC cant track original cost element


Tfr only primary cost posting
Tfr only primary cost posting
Tfr only primary cost posting

KSU5

KA01
KA06

Expenditure
Revenue
Sales & Deduction
External Settlement

CSKS
CSKA

Internal Settlement
Result Analysis
OH RATES
Assessement
Internal Activity allocations

O/H orders, Investment orders, Accrual Orders

KO01
KO88
Maintained in Order type
An assignment shows which costs (origin: cost element groups from debit cost
elements) are to be settled to which receiver type (for example, cost center, order,
and so on).
A source structure contains several source assignments, each of which contains
the individual cost elements or cost element intervals to be settled using the same
distribution rules.

Settlement lets you transfer costs, revenues, sales deductions and production
variances to costing-based Profitability Analysis. The PA transfer structure defines
which quantities or values of a sender are to be transferred to which value fields in
CO-PA as part of settlement

COPA

o both so planning (sales quantity planning) revenue & expenditure planning at the segment level (characteristics). The sop plann
xpenditure will be used in reporting and helpful to analyze between plan & actual values. COPA Planning consists of 4 steps.
Determine the level at which planning is required to be done
using characteristics

KEPM

Characterisctics values are specified in planning package


It contains all the settings required for execution of planning

t based COPA

Product Costing
What are the important Terminologies in Product Costing?:
Results Analysis Key This key determines how the Work in Progress is
calculated
Cost Components - The break up of the costs which get reflected in

the product costing eg. Material Cost, Labour Cost, Overhead etc
Costing Sheets - This is used to calculate the overhead in
Controlling
OH KEY
Costing Variant - For All manufactured products the price control
recommended is Standard Price. To come up with this standard price for
the finished good material this material has to be costed. This is done
using Costing Variant. Further questions down below will explain this
concept better.
The costing variant contains all the control parameters
for costing.
The configuration parameters are maintained for costing type, valuation
variants, date control, and quantity structure control.
In costing type we specify which field in the material master should be
updated.
In valuation variant we specify the following
a) the sequence or order the system should go about accessing
prices for the material master (planned price, standard price,
moving average price etc).
b) It also contains which price should be considered for activity price
calculation and .
c) How the system should select BOM and routing

Create cost estimate - CK11N


Mark and releaseing cost - CK24

Maintain %

Organisation Structure
Operating Concern
!
Controlling area
!
Company Code

Organisation unit (or) Organisation Structure: This represents closed system used for costing accounting purpose

Operating Concern
An operating concern represents an organization units in the company for which sales market as a unifor

Controlling Area
It is an organization unit for cost accounting purpose to track the overhead related activities. Manufactur

haracteristics). The sop planning can be transferred to the production planning as a demand planning based on this production pe
nning consists of 4 steps.

Maintain %

ing accounting purpose. In Co main organization units are operating concern & controlling area.

sales market as a uniform structure. It is the valuation level for profitability analysis. Operating concern is the highest level in cl

d activities. Manufacturing related activities to track the internal units. Controlling area contains one or more company codes. W

ed on this production people they will convert demand planning to the production. That is creation of production order.

s the highest level in client. It is recorded all marketing related and segment activities. It will be used mainly in copa.

more company codes. Which can operate different currencies.

duction order.

Row

Base
10 B100
20
60 B200
65 B110
70
75
80
90
100

Material OH
Valid from To
01.01.2013 31.12.9999
01.01.2013 31.12.9999

Overhead Description
Raw Material
RK00
Material OH
Production Costs
Semi-finished goods
Manuf. Cost Level
COGM, total
RK01
Production OH
RK01
Production OH
Cost of Goods Sold

From

CO Area

Plant

1000
1000

10

10
10
70
75
75

OH Type
1
2

1000
1000

To Row

Credit
E00

60
65
E03
E04
90

Percen
10%
10%

Goods Movements

Movement Type
101
103
105
121
122
124
161
201
221
251
261
281
291
301
303
305
309
311
313
315
321
323
325
331
333
335
341
343
349
351
411
413
451
453
455
457
459
501

503
505
521
523
525
531
541
543
545
551
553
555
557
561
563
565
581
601
603
605
621
623
631
633
641
643
645
647
651
653
655
657
661
673
675
701
703
707
711
713
715
717

Consumption Indicator

The only consumption indicator that is permitted forconsumptionis(V). You can perform account ass
Cost center
Production order
Internal order
The consumption indicatorsasset(A),sales order(E) andproject (P) may not be used.

Material document list (transaction MB51)


You can use theValuationindicator to specify that the system read the valuation for the material docu
For catch weight materials, the system displays the parallel quantity in the parallel unit of measure.
Display of stock in transit (transaction MB5T)
For catch weight materials, the system displays the parallel quantity in the parallel unit of measure.
Purchasing documents for vendor (transaction ME2L)
The system displays the following quantities in the parallel and order units of measure and, if necessa
Order quantity
Quantity still to be delivered
Quantity still to be calculated
Purchasing documents for material (ME2M)
The system displays the following quantities in the parallel and order units of measure and, if necessa
Order quantity
Quantity still to be delivered
Quantity still to be calculated

Goods Movements

Movement Types
Description
Goods receipt for purchase order
Goods receipt for purchase order to GR blocked stock
Release from the GR blocked stock for the purchase order
Subsequent adjustment for subcontracting
Return deliveries to vendor
Return delivery to vendor from GR blocked stock
Returns for purchase order
Goods issue for a cost center
Goods issue for a project
Goods issue for sale (without sales order)
Goods issue for an order
Goods issue for a network
Goods issue for any account assignment
Plant to plant transfer in one step
Plant to plant transfer in two steps stock removal
Plant to plant transfer in two steps putaway
Transfer postings from material to material
Transfer of storage location to storage location in one step
Transfer of storage location to storage location in two steps stock removal
Transfer of storage location to storage location in two steps putaway
Transfer of inspection stock unrestricted-use stock
Transfer of storage location to storage location inspection stock
Transfer of storage location to storage location blocked stock
Sample from the inspection stock
Sample from the unrestricted-use stock
Sample from the blocked stock
Status change of a batch (unrestricted-use to restricted)
Transfer of blocked stock unrestricted-use stock
Transfer of blocked stock inspection stock
Goods issue for a stock transport order (without shipping)
Transfer of special stock to own stock (only for sales order stock)
Transfer posting to sales order stock
Returns from customer (without shipping)
Transfer of blocked stock returns to unrestricted-use stock
Returns stock transfer
Transfer of blocked stock returns to inspection stock
Transfer of blocked stock returns to blocked stock
Goods receipt without purchase order unrestricted-use stock

Goods receipt without purchase order stock in quality inspection


Goods receipt without purchase order blocked stock
Goods receipt without order unrestricted-use stock
Goods receipt without order inspection stock
Goods receipt without order blocked stock
Goods receipt of by-products from order
Transfer of unrestricted-use stock to subcontracting stock
Consumption from subcontracting stock
Goods receipt of by-products from subcontracting
Scrapping from unrestricted-use stock
Scrapping from inspection stock
Scrapping from blocked stock
Issue from stock in transit (adjustment posting)
Initial entry of stock balances unrestricted-use stock
Initial entry of stock balances quality inspection
Initial entry of stock balances blocked stock
Goods receipt of a by-product from network
Goods issue for delivery
Goods issue for a stock transport order (shipping) with additional item
Goods receipt for a stock transport order (shipping) with additional item
Transfer of unrestricted-use stock returnable packaging with customer (shipping)
Goods issue from returnable packaging with customer (shipping)
Transfer of unrestricted-use stock consignment stock at customer (shipping)
Goods issue from consignment stock at customer (shipping)
Goods issue for a stock transport order (shipping)
Goods issue for a cross-company-code stock transport order
Goods issue for a cross-company-code stock transport order performed in one step (shipping)
Goods issue for a stock transport order performed in one step (shipping)
Returns from customer (shipping)
Returns from customer (shipping) to unrestricted-use stock
Returns from customer (shipping) to inspection stock
Returns from customer (shipping) to blocked stock
Returns to vendor using shipping
Returns for a cross-company-code stock transport order (shipping)
Returns for a cross-company-code stock transport order (shipping) performed in one step
Inventory difference in unrestricted-use stock
Inventory difference in quality inspection stock (MM-IM)
Inventory difference in blocked stock
Inventory difference in unrestricted-use stock (LE-WM)
Inventory difference in quality inspection stock (MM-IM)
Inventory difference for returns
Inventory difference in blocked stock (LE-WM)

ption Indicator

consumption indicator that is permitted forconsumptionis(V). You can perform account assignment for the foll

umption indicatorsasset(A),sales order(E) andproject (P) may not be used.

REPORTS

document list (transaction MB51)


se theValuationindicator to specify that the system read the valuation for the material documents to be display
weight materials, the system displays the parallel quantity in the parallel unit of measure.
f stock in transit (transaction MB5T)
weight materials, the system displays the parallel quantity in the parallel unit of measure.
ng documents for vendor (transaction ME2L)
m displays the following quantities in the parallel and order units of measure and, if necessary, in the stockkeep

still to be delivered
still to be calculated
ng documents for material (ME2M)
m displays the following quantities in the parallel and order units of measure and, if necessary, in the stockkeep

still to be delivered
still to be calculated

ollowing objects:

played from Inventory Accounting.

eeping unit.

eeping unit.

Key elements of WIP Results Analysis Configuration.


Step 1Define Results Analysis KeyOKG1.
Here you just give a name, four letter key with its description.
Step 2Create cost elementsof type 31 the following minimum

1.
2.
3.
4.
5.

Valuated Actual cost, say for eg. 990001.


Calculated Costs, say 990002.
WIP account 990003
WIP Reserve 990004
WIP Reserve 990005

Step 3Define RA version, OKG9, Enable Transfer to Financial Accounting (checkbox)


Under extended control, you may enable checkboxes relating to

Generate line items


Assignment/RAkey
Update / RAkeyEnter the cutoff period for actual RA/WIP, the effective date before which any WIP data
Step 4In OKGC,define the valuation method for WIP.
Here, you specify that WIP calculation mode is one when the order has the staus REL.
The calculated WIP shall be cancelled when the order status changes to DLV or TECO. You maintain th
Step 5SPRO>Controlling>Product Cost Controlling>Cost Object Controlling>Product cost by orde
The line IDs are similar to cost component, that you create during cost estimates like a) 010 for Mater
Besides these, create one more line ID say 999 for the Settled Cost, which appear as credit when you

Create additional WIP type 31 cost elements and their corresponding Reserve account for the above#

1. WIP Material Reserve 990007


2. WIP Labor 990008
3. WIP Labor Reserve 990009
4. WIP Overhead 990010
5. WIP Overhead Reserve 990011
Step 6 Now you assign the source cost elements OKGB, that are expected in the production order
You maintain this data for CO area, RA version and RA key combination. You use masking when you m
Step 7 Define the update. OKGA You maintain this data for CO area, RA version and RA key combi
Here you specify which line IDs are to be grouped under which cost elements and their reserve accou
Step 8 Define posting rules for WIP calculation OKG8
You do this for Controlling area, company code, RA version. Maintain this for RA category WIPR (WIP co

Step 9Ensure number range assignment for the WIP transactions under appropriate head OKG6:
KABG Automat. WIP/results analysis

KABM Manual WIP/results analysis


KSWP Prim. Target Cost Calc. (WIP)
KSWS Sec. Target Cost Calc. (WIP)
Period end WIP calculation Process
The process of running WIP is the t-code KKAX for individual order processing and KKAO for collective
Note:
The RA Key shall be entered in the production order, under the control tab. This can be defaulted thro

e which any WIP data if existed, will not be altered.

ECO. You maintain this data for CO area, RA version and RA key combination.
Product cost by order>Period End Closing>Work in process>DefineLine IDs.
like a) 010 for Material b) 020 for Labor and c) 030 for Overhead to say the least.
r as credit when you make a goods receipt.

count for the above#### WIP Material 990006

the production order to various line ID as created above.


masking when you mention which cost element to be assigned to various IDs. You can also direct various cost e
on and RA key combination.
d their reserve account. You connect the cost elements created in step 5 to the line IDs. The category for the line

ategory WIPR (WIP cost, Required to be capitalized) and RUCR (Reserve for unrealized cost). You maintain the P

ropriate head OKG6:

d KKAO for collective order processing. The system debits the WIP account and credits Inventory Change accoun

an be defaulted through order type.

direct various cost element, if it comes with a combination of particular cost center and activity type to a partic

category for the line IDs for material, labor and overhead shall be K, that stand for cost. The line ID 999 settled

. You maintain the P& L account (changes to stock) and the balance sheet (WIP)account.These G/L accounts ar

ntory Change account. This entire WIP is reversed and a new entry is passed the following month. When the ord

ivity type to a particular Line ID. If you need to keep it simple, just enter +++++++ for cost centers, activity t

he line ID 999 settled cost shall be maintained as category A, (settled cost). When you assign A, you won't have

hese G/L accounts are posted in Financial Accounting.

month. When the order is fully delivered no additional WIP entries are passed.

ost centers, activity types and Business processes. Cost elements can be masked as follows; for eg. All cost prim

gn A, you won't have to maintain any cost elements for WIP and reserve creation.

; for eg. All cost primray cost elements for materials, if they start from 210001 to 219999, the you can mask th

the you can mask them like 00021+++++. Give the line ID in the column Required to Capitailze.

SD-FI
VKOA
SAP provides 5 ways to determine G/L account in SD modules.
These are
1 Cust.Grp/MaterialGrp/AcctKey
2 Cust.Grp/Account Key
3 Material Grp/Acct Key
4 General
5 Acct Key

OBYC
BSX
GBB
WRX

INVENTORY POSTING
OFFSETTING
GR/IR

NVENTORY POSTING
FFSETTING

Steps in the Manufacturing Process with the Associated


Financial Postings
Period postings
Posting to cost centers
Raw materials issued from inventory to the production order
Activities allocated from the production cost center to the production order
Finished goods are received into inventory from the production order
Month-end postings
Apply overhead from the manufacturing cost center to the production order
Calculate work-in-process for the production order
Post cost center variances
Calculate production order variances
Run settlement to post WIP and variances of the production order to the G/L

A. Posting to cost centers


1. Posting costs to service/administrative cost centers
2. Allocating from service/administrative cost centers to production overhead cost centers
3. Posting of costs to the production cost center
B. Raw materials issued from inventory to the production order
C. Activities allocated from the production cost center to the production order
1. Setup labor hours
2. Labor hours
3. Machine hours
E. Finished goods are received into inventory from the production order (Period 2
only)

Steps in the Manufacturing Process


Month-End Postings
F. Apply overhead from the manufacturing cost center to the production order
1. Apply material overhead
2. Apply machine overhead
3. Apply labor overhead
4. Apply administrative overhead
G. Calculate work-in-process for the production order
1. Calculate WIP for open production order (Period 1 posted at settlement)
2. Cancel WIP for confirmed production order (Period 2 posted at settlement)
S. Post cost center variances (manual clearing)
T. Calculate production order variances for confirmed production order (posted at
settlement)

FCV
OB08
OBA1

APP
FBZP
F110

Maintain Exchange rates


Automatic account assignment
KDB- Losss/gain account
KDF - Revaluate open gl account items

Bank account settings


Pay ment run

ASSET
AJRW
AFAB
A090

Fiscal year change


Dep run
Account determination

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