Cost of the goods

Dear Forum,
When the goods issue to order or cost center, the cogs debited and inventory credited.
1 May I know when is the cost being calculated so that when the time I do GI, the system know how much to post.
2 Normally how many kind of cost included?
Thanks

Hi,
1. Cost of manufacture of a Product is what the value of goods sold or Cost of Goods sold (COGS). Either, you use the SAP Costing module (CO-PC) to let SAP determine COGS or you can manullay input COGS into material master fields (Standard or Moving Average) in Accounting view of Material master. In either case, COGS is stored in the material master valuation (Accounting) view.
2. You mean in a COGS? Whatever costs it takes to manufacture a product is included in COGS, for instance Material cost, Labor cost etc.,
Hope this helps.
PS: There is lot of documentation available online SAP help protals and please refrain from using this forum for asking such basic questions and restrict to only questions of clarificatory in nature or issue based questions.
Make an effort to read the SAP help documentation for all your basic questions.
http://help.sap.com/saphelp_erp60_sp/helpdata/en/80/ea89395eb58c4f9d0c3e837cf0909d/frameset.htm
Mods (Moderators) will lock your threads, if you continue to ask such basic questions, so no one can reply to it.
Edited by: Pradeep kumar Athmakur on Feb 27, 2010 12:41 AM

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COGS (Cost of the Goods Sold) in OPM reg.

Hi
Can anyone provide the details about COGS (Cost of the goods sold) documents/set up in R12.
This is very urgent.
Kindly do the needful.
Mail id : [email protected]
Regards
Raj

Hi,
1. Cost of manufacture of a Product is what the value of goods sold or Cost of Goods sold (COGS). Either, you use the SAP Costing module (CO-PC) to let SAP determine COGS or you can manullay input COGS into material master fields (Standard or Moving Average) in Accounting view of Material master. In either case, COGS is stored in the material master valuation (Accounting) view.
2. You mean in a COGS? Whatever costs it takes to manufacture a product is included in COGS, for instance Material cost, Labor cost etc.,
Hope this helps.
PS: There is lot of documentation available online SAP help protals and please refrain from using this forum for asking such basic questions and restrict to only questions of clarificatory in nature or issue based questions.
Make an effort to read the SAP help documentation for all your basic questions.
http://help.sap.com/saphelp_erp60_sp/helpdata/en/80/ea89395eb58c4f9d0c3e837cf0909d/frameset.htm
Mods (Moderators) will lock your threads, if you continue to ask such basic questions, so no one can reply to it.
Edited by: Pradeep kumar Athmakur on Feb 27, 2010 12:41 AM

Ordered item to absorb the cost of the free goods

We have created an exclusive free goods agreement and we would like the ordered item to absorb the cost of the free goods. In order to transfer the correct information to CO-PA from SD billing, what should we do? Can anybody explain briefly?

Hi Yasar,
we do the setting for this in copy controls from delivery to billing.
pl go to t.code VTFL, select the item which is required to abasorb the cost.
there you will find a check box " cummulate cost ". Tick it here, this will make the cost of the free item to be transferred to the main item. This can also be used even incase of BOM's.
regards
sadhu kishore

Should the Goods Receipt Inventory Transaction include Item Cost selection?

When processing a Goods Receipt inventory transaction, the Price List pull down does not display "Item Cost" as a selection.
The user can make the Unit Price field visible and active, compare the cost displayed from the Price List selected to the current Item cost and update if different. This forces the user to be very cost cognizant as none of the price lists available are guaranteed to be equal to the current item cost.
Update of the record can cause a cost revaluation in moving average or a cost varinance account adjustment in a standard cost system.
The companies I have talked to would prefer to select Item Cost in the price list field as they can do in the Stock Posting.
I am looking for further input on this.
Thanks,
Jim

No replies since April 2009, closing.

Actual cost at the time of Goods Receipt

Hi All,
When I create Goods Receipt, I am getting actual cost in WBS Element. As per customer request, When I do the Goods Issue then only actual cost has to come to WBS Element.
1. Is it due to statistical cost element cretaed for inventory account (BalanceSheet account)?
2. If statistical cost element not cretaed, will commitment raise?
(Or) Am I missing any configuration settings?
Regards
Suresh

Sureshkumarsap wrote:
> 1. Is it due to statistical cost element cretaed for inventory account (BalanceSheet account)?
Yes, if you are using valuated Project Stock.

Validation for Cost center for Goods issue against the cost centers

Dear Friends
In my client place we have 6 plants are defined and profit centers are defined for each plant. Hence here each plant is one profit center. Cost centers are defined plant wise.
The requirement is when the goods issued to cost center system should check the cost center is defined against the plant. ( i.e., Cost center def against the Profit Center, and Profit center equal to Plant).
Is there any provision to assign the plant to profit center or vice versa?
Please guide me how to resolve the issue.
Thanks in advance.

Hi
Please check EC01. May be it can help you. But in my view it is not possible.

Configuring requirement : ordered item to absorb cost of free goods

Hello Friends,
I need to configure this in SAP SD.
The main item should accumulate the cost of the free goods.
I have set the cumulative indicator and deactivated pring for this item.
Do i still need to configure the stock value for the free goods as cost free item? Or is this step only applicable for
another scenario, like,
If I were to activate Pricing such that free goods is displayed as subitem and VPRS configured as cost and discount set to 100%
1. Set Item category to TANN using FREE usage AND
2. use condition type RL00 with requirement 55.
3. use pricing type B.
regards
Ravi

Read this SAP help at http://help.sap.com/saphelp_47x200/helpdata/en/dd/55fa4e545a11d1a7020000e829fd11/frameset.htm and the topic Free Goods in Sales and Distribution Processing for details.
Also go through each step of the configuration of the path at SPRO->Sales and distribution->basic functions->free goods.
Regards,

Actual Cost of finished goods in MIGO

Hi,
The value of Finished material in FI Document generated in MIGO takes the (Goods Receipt Quantity) X (Planned/Moving average Price from material master), Where as it should take the Total Actual Price calculated after Order Confirmation Based on Actual Material Purchase Price & Actual Activity Posting Value.
For example:
Present scenario
Material-> MIGO QTY>Moving Avg Price -->MIGO FI Document Value
Finished> 1000 EA> Rs. 10/ EA--
>Rs. 10,000=00
Required Scenario:
MIGO FI Document value= (Purchase Value of Raw Material)+ ((Activity Posted while Confirmation)X(Activity price))
Thanks.

Hi,
What u said is right Mr Kapil.. See when u do GR From Production Order System Calculate Moving Price or Planned Price from
material Matser .
As per ur Reuirement u told it should calculate (Raw Material Price + activity+OVHD).
it is possible only when order quantity is less , suppose say your order qty is 150 mt per day and your Plant capacity is 500mt
per day production will be done in a half day, sale can be done on same day after Production with the formula what u told.
If suppose say , Your order is 2000 ton of Oil , it will take u to complete 4 days for your Total production as you told, GR should
be done on (Raw Material Price + activity+OVHD) formula, you dont know exact activity price for 2000 ton until u finish your total
production, at the same time until u do GR sales cannot be done. So in SAP Gr is intially done on Moving Average Or Planned
(Standard Price) , After totla Prodcution GR is Compared with Actual Cost(Raw Material Price + activity+OVHD)= :"Variance".
Plus are MInus is Reduced or added to Finished Goods Account or PP account during Settlement.
If any wrong Pls Correct me Experts,
Pavan

Target Cost in the settled process order become zero after cost deletion

Dear all,
User has standard cost estimates created in Jan 2010 that valid until the end of 2010 for every material in the system. user created a process order in April 2010. Target cost of the order was created based on the standard cost estimate and recipes as well as order qty. The order was also confirmed and settled in April 2010 without problem.
However, after I deleted all old costing estimates before I did a costing run for all materials in May 2010, the old order was resettled and all Target cost is removed from the order. I guess system try to look at April costing estimate but it is not there since it was deleted before I created the new costing estimate in May. Therefore, all varainces are throwed into remaining variances since the target cost become zero.
Other than mark the settled order for deletion or keep all old costing estimates, I am just wondering is anyway in the configuration to prevent the system to recaculate the target cost again for the settlement so I can avoid the problem happens?
Thanks.

Hi,
Target costs are only calculated after goods movements have occured on the order, the Target Costs are then calculated during the Variance calculation.
Target costs will only be calculated after the first goods receipt has been posted to the order. Also you have to ensure that the information to calculate target costs exists on the system in particular in OKV6.
This estimation is based on the customizing for the Target cost version in transaction OKV6 as in turn will the "real" calculation of the Target costs via the variance calculation.
So in OKV6 the Target cost will be based on preliminary costing on the order, an alternative cost estimate or the current standard cost estimate. Importantly if the choosen option is not fulfilled e.g. no current standard cost estimate, the target costs will not be predicted or calculated.
regards
Waman

Packaging material is not appearing in the Goods receipt of STPO

Dear All,
We are currently dealing one Roll-Out project for one multinational company. In that from sales side, one of the main processes defined is u201CStock Transport Purchase Order processu201D. As a regular process, outbound delivery document also created with ref to STPO.
As per the client requirement the u201CPackaging materialu201D needs to be added as additional line item in the delivery to calculate the packaging cost. This packaging material is a "Stockable and Valuated" material. So while performing the PGI the stock will get reduced from SD side.
The problem is, using this same STPO delivery document the Goods receipt is planned to do in the another side of company code. while doing the Goods receipt system is displaying only the "Finished Product" only. The packaging material is not displaying while doing the goods receipt in the another company code.
due to this we are not able to complete our test cycle.
so we need the expert opinion to solve this issue.
if the packaging material is added as additional line item while doing Goods receipt then, the problem is solved.
Kindly suggest us...
Regards,
MANI
frWe have customized that also and now u201CPackaging materialu201D is adding as a new line item in the delivery document as a non valuated material.
But the issue is, the Billing type u201CZICu201D is not getting determined while creation of billing if u201CPackaging materialu201D is added as a new line item. If u201CPackaging materialu201D is not added as a line item then, billing type is getting determined automatically without any issue.
We have checked in LIKP table, its containing the billing type as u201CZICu2019. But if packaging material is added then, the billing type determination is not happening.
We are assuming that some customizing needs to be done from MM/SD point of view. I am seeking the experts help regarding this issue to solve the problem.
Regards,
MANI

Dear Friends,
Thanks for the Feedback.
Even though it is a associated company, in one company code the packaging material stock was reduced and packed for the STPO shipment.
After receiving the consignment, in the receiving company code they will perform the goods receipt with ref to "Outbound Delivery" document.
Since in the outbound delivery document "Packaging material" also available. So as a business strategy we are expecting the same "packaging material" also should available for goods receipt.
I hope i have explained with max of my knowledge to clear your doubt.

Allocation of overhead cost to finished goods through vendors and raw mat.

We are trying to allocate a cost base in our purchasing department of around 200 mio dkk to our finished products. These products we manufacture ourselves. The cost represents salaries and external services
The outcome of an ABC study has been to allocate these costs, first on vendor level based on the total spent on each vendor and subsequently to the raw materials from each vendor based on value. The cost of purchasing should then be included in cost estimate of the raw material and hence in the cost of the finished goods through the bill of materials.
Our challenge now is to implement this algorithm into our product costing system in SAP.
The easy solution from the point of view of the SAP department is to have cost controllers doing the math of calculating the cost per material number in Excel and then allocate this rate through a costing sheet or a template.
But this solution on the other hand leaves the users with an extra manual task which again leaves room for error and it reduces transparency.
So has anyone tried implementing such a calculation scheme in product costing?

Hi
As far as I know, SAP does not support this... What you can do is
1. Calculate this price outside the system and include this overhead in the Plan Price of raw material (Costing 2 View).. So, this gets included in raw mat price itself
or
2. if you want to see it as an overhead, you need to arrive at an overhead% which you may calculate as Amount of these Expenses / Total raw material cost and apply this % across
Study the historic data of past 3-4 years to see if the % remains more or less stable
br, Ajay M

How to get unit cost for finished goods in prod order

HI all,
IN a production order of type PP04, there is cost analysis you can get from CO03. This shows the cost for finished goods and BOM components. Would anyone know how the cost for finished goods are calculated ? The issue i have is that the unit cost of the finished goods is not correct. It is higher than what it should be. I looked at the moving avg price at material master but the cost used in calculation is different than in material master. Can anyone shed light how finished goods are calculated and why it is picking up a higher unit cost ? Where is the higher cost coming from for finished goods material as shown in CO03 ? The BOM materials are picking unit cost correctly. Would this have anything to do with cost settlement ?
thank you.
joyce

Hi,
Finished goods price will depend on BOM componenet price, activity price and overhead price. Check whether this prices are picking correctly or not.
Regards,
Sreekanth

Transportation cost before the reception of the material in MIGO (Stock in transit)

Does it exist a way to make a reception of materials in transit and post the transportation cost before the reception of the material in MIGO ?
The material is own of company before to be receipt in plant. We need to pay the transportation before that material is arrived at plant.
As the value is an important cost, we need that this cost be linked with the cost of the material. We can put a condition, but it does not work if the material in not receipt in MIGO. We can enter a subsequent debit memo, but the invoice of the reception should be enter in the system and by the way the reception too. So how should we process to link the transportation cost with the material if this material is not received at plant and by the way in MIGO.
Thanks in advance

Hi,
As of my knowledge, system will allow to process the shipment document - create shipment cost document and vendor invoice also, even before doing GR for the PO. Please check the scenario and revert back if you are getting any error.
If you want the shipment cost as delivery cost, refer the note: 427944 - Info: Shipment costs as delivery costs during goods receipt
Regards,
AKPT

Value of the goods movement is negative in GR

Dear all,
While preparing GR for an imports sch agmnt we are receiving an error message "Value of the goods movement is negative".
System is giving the diagnosis of the error message are "Sub-contracting by-product value is higher than GR value" & "Delivery cost is negative".
But our case is an imports GR and we have prepared GR for same sch agmnt on last month also.
Pl send us your valuable suggestions to resolve this issue. (What are all the other factors to cause this type of error)
Regards,
M.Sarathi

Hi
Check the following
1) In Scheduling agreement additional data for that line in ME32l, check for field Pr.date.cat. It should not be 5. If it is 5 and the price validity falls below GR date then you get this errror.
2)If you get that Pr.date.cat field in display mode, remove time dependent condition tick from document type config. then it will allow you to change.
Hope your problem will be solved. If not please revert back
Regards
Antony

Cost of sales goods accounting

Dear all,
We have different type of the sales order. At opm level we have accounting entries against sales order like this cost of goods "dr" and finish product stock "cr". Now I have
created one more order type and want dr account (expense ) that is not cost of goods ,Mean I want to dr the account on the base of sales order type for sales order entry.
Kindly let me know how can I do that. Although cost of sales goods(account) is given at organization level. Is this possible?
Thanks

Hi all
Is there any risk in doing the account determination through User exit in such a scenario. I have found a user exit EXIT_SAPMM07M_001 and include z_mm_exit_zxmbcm02_05 as useful instead of mapping the whole process for this transaction.
This user exit is working fine. Any risk people feel in bypassing OBYC through User exit.
Regards
MEHTA

Cost of the goods

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