MIGO Cancellation with MM Small Difference

Question

Hi SAP Guru,
i have question regarding "MM Small diff. loss" in the accounting document for Good Receipt (cancellation).
in Period 09/12 my material "ABC" cost price is 33.60, and this material stock is for Plant "1000". the order quantity is 48 unit. When creating PO, my user has wrongly put the cost price to 3.60, and that PO XXXXXX has been good receipt in period 09/12.
with in the period 09/12. there is other PO that has been GR with the correct Cost price (33.60). In the Period 10/12 my user has realize the cost price for PO XXXXX  is wrong, and my user has perform the cancellation using MIGO,
when i check the cancellation accounting document, i found out there is a line item for "MM small diff. loss". what does this "MM small diff. loss" mean ? as my understanding , i know found this on the MIRO.
thie is account entry
11109050      Stock-PrtGenuinePart           1,612.80-
21104010      GRIR GenuinePar                  161.28
60220940      MM small diff. loss                 1,451.52

Answer 1

Whenever there is a price variance during goods posting or invoice posting, in case of standard price, a price difference account is being hit to clear it.
But sometimes price difference account also pops up in moving average price. Whenever there is a price variance and we dont have enough stock/stock value to clear it, then the remaining amount will hit the price difference.
As your case is normal and just  to understand better, I provide another example.
MAP : 10 INR
Total stock quantity: 10 EA
Total stock value: 100 INR
Now an invoice for 40 material with price variance of 5 INR ( ie the invoice price per unit = 10 INR- 5 INR =5INR ) have to be posted . So the stock account should be credited ny 5*40 INR = 200 INR . But the total stock value is 100 INR.
In this case the system credit the stock account by 105 INR =50 INR, and post the remaining 305 INR = 150 INR to price difference account.