Costing Method / Work in Process

Dear All PS Experts,
I have a doubt which costing methods we are using regarding Work in Process Caluclation. Specillay we are working in ETO Process. I have tried from long back even though i didnot have full clearity regarding WIP for ETO. Is ther any body has any idea let we share the points. Thanqu
Regards

Hi,
If you want to calculate WIP then use 01 Method otherwise if you want to recognize revenues then use 03 method.
But the client should come from the client whether they want to see WIP or accrued revenues in FI.
Muzamil

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WIP-Work in Process

Hi Experts,
Please tell me what is exact WIP in production order settlement. Why it is need to Calculate WIP using Tcode : KKAX - Individual Processing.Pls don't suggest SAP library.
I don't want defination of WIP.If possible explain with example.
Vipul.

Dear,
WIP means work in process material..
WIP Calculation --- difference between the debits and credits of an order as at the period end when you calculate WIP.. in other words, it is the value of undelivered stock from an order. It is always calcualted in term of currency not in term of quantity.
When you need to display the value you can use transaction KKAY orKKAQ.
When you WIP calculation system will calculate the production cost incurred till that time w.r.t. different cost element(direct cost indiredt cost/material and activity) and updated to different accounts.
Hope clear to you.
Regards,
R.Brahmankar

WIP work in process in PM/CS orders

Hi everybody,
Reading the concepts of the use of WIP, is mentioned that it can be applied also in services:
http://help.sap.com/saphelp_40b/helpdata/es/89/a42c7a461e11d182b50000e829fbfe/content.htm
I have been working with PM/CS, and the cycle ends with the billing of the sales document that is generated from the service order, but i have problems applying the settelment rule, because i only use one G/L account and Financial area teold me that i must be work with 2 G/L accounts, one for the service in process and the other when the service finishes.
By the other hand, also they mentioned that i have to determine the sales cost from the settlement of the general order.
Can somebody help me?

Dear,
WIP means work in process material..
WIP Calculation --- difference between the debits and credits of an order as at the period end when you calculate WIP.. in other words, it is the value of undelivered stock from an order. It is always calcualted in term of currency not in term of quantity.
When you need to display the value you can use transaction KKAY orKKAQ.
When you WIP calculation system will calculate the production cost incurred till that time w.r.t. different cost element(direct cost indiredt cost/material and activity) and updated to different accounts.
Hope clear to you.
Regards,
R.Brahmankar

How to calculate work in process for maintenance order

how to calculate work in process for maintenance order i.e raw materials not used

Hi,
Generally, when u create PR from maintenance order, account assignment category should be F. Cost of services first settles on the order when u create service entry sheet. Further it got settled onto settlement receiver given in order.
If you want to change the category from F to K for maintenance orders then follow the IMG menu path as given below.
Plant Maintenance and Customer Service > Maintenance and Service Processing > Maintenance and Service Orders >
General Data > Define Account Assignment Cat. and Document Type for Purchase Requisitions

Material cost charge to Production Order from Cost Center / Work Center.

In Production Order Environment, is it possible that goods are issued from Storage location to Cost Center / Work Center, and in turn charged to Production Orders.
Scenario. Transformer Manufacturing.
Production Order size : 100 Units
Steel (Kgs) per Transformer : 3 Kgs
Total Steel required for Production Order: 300 Kgs (100x3)
In the process of manufacturing of a Transformer Steel or Core winding is the first process step.
Even though the Steel required for above said Production Order is 300 Kgs, the minimum issuable lot size from stores is 2000 Kgs.
Is it possible in SAP ECC 6.0 that the Steel of 2000 Kgs is issued to a Cost Center / Work Center, and later charged to production order based on actual Consumption in the said Cost Center / Work Center.
Regards, Replies and Sugestions shall be appreciated
Madhu

Thank you for the reply,
However, the scenario that i had in mind was a bit different from what you had conceptualized.
Scenario - These transformers are basically for loading on to Inverters & UPS, The max weight of the transformer range from 15-30 Kgs. and they dont have an external casing of steel as seen on Indian Electricity Board transformers. Multiple production orders are processed at a single time in the Plant as per Customer specifications.
The general process followed for manufacture is as follows:
1. Core Winding u2013 This process takes place in the core winding department. Steel reels are loaded on to Winders and individual cores of approx 5 u2013 30 Cm Diameter are produced. (Multiple reels of Steel are stacked one on top of the other onto a pallet.) Usually issue of steel from stores happens pallet wise. The pallets of steel generally weigh in excess of 2 tons.
In the present situation (Non SAP Environment) the entire pallet of Steel is issued to the Core winding department and later the Output is charged to multiple Production Orders, based on the records of the Core winding dept. Since in general the steel content in the FG ranges from 3- 25 Kgs multiple Production Orders can be catered to from one Pallet of Steel.
2. Core Laithing. The wound cores are laithed so as to make the sides smooth.
3. Core Annealing u2013 Heat treatment process.
4. Core Insulation. u2013 Insulation of the annealed cores with insulating material.
5. Primary Winding. u2013 Copper is wound as per the BOM Specification. The issue like that of Steel also arises in the Copper winding process. Here also the Cooper comes in Spools which far exceed the requirement for any Production Order. The minimum issueable lot for Copper from Stores is one Spool. The current practice followed is that the Cooper is taken in the name of the Copper winding department and later charged to individual Production Orders.
6. Primary Soldering.
7. Mid Insulation.
8. Secondary Winding
9. Secondary Soldering
10. Shielding
11. Final Insulation u2013 Same issue with insulation too, since the insulating material comes in rolls.
12. Testing.
13. Potting & Drilling - Process of pouring a chemical compound in the center of the transformer, which helps the transformer to later be loaded on an Inverter. The same issue with like of Steel, Copper & Insulation arises here too, since the chemical compound comes in big containers capable of meeting production requirement for a week.
14. Packing
15. Transfer to FG Inventory.
One of the suggestions was to issue the entire 2000 Kgs to the Production Order and then return 1700 kgs after completion of the Production Order based on actual usage. However, in my opinion this option might not be practicable because, assuming that I get another / multiple Production orders in between the issue of 2000 Kgs and return of 1700 Kgs, issue to the new Production order will not be possible if the stock in stores was only 2000 Kgs initially. In case assuming that the material is available in stores for the next production order, the situation could worsen in case of receipt of multiple production orders.
Hope, I have explained the scenario & issue being faced.
Regards
Madhu

R12: Cost Method in Inv Setup Org Params Costing Information

Can someone confirm my suspicion that the Costing Method field in Inventory > Setup > Organization Parameters > Costing Information tab DOES NOT APPLY to OPM "process enabled" organizations?
The actual costing method for OPM is determined by the Cost Type that is setup within OPM Financials and assigned to the OPM Cost Calendar.
Just curious if the Costing Method field has any affect (good, bad, or ugly) whatsoever with the OPM setup...

Yes, I'm pretty sure it has no meaning when you enable an org as process mfg. I can't get into conventional item costs when org is OPM enabled - it gives a message. The OPM costs are stored in another table to normal costs and it makes sense that you can't have an OPM and a discrete cost for the same item in the same org as only one cost can make it through to the GL.

Migration of Cost Transaction Work In Progress Values into the Projects

Hi,
Can anyone kindly help me out in the approach to adopt for the Open Work in progress value migration into the projects applications of Oracle Applications.
Thanks in Advance,
Lavanya
Edited by: Lavan ya on Nov 15, 2009 12:54 AM

Hi
The migration strategy depends on the way the company will for forward with its accounting procedure.
I assume the project is incurring costs as work occurs, and supplier invoices are entered. At the end of the period the company need to move the value of costs which has not matched to the period revenue into a GL account representing the Work in Progress. If the model is calculating the figures on the marginal period, and not accumulated ITD amount, then your approach may be valid.
The question regarding converting the project invoices (sent to customer) also depends on the method you accrue revenue. If Revenue and Invoice is always taken on the same time for the same value, you don't need to maintain UBR&UER balances. However, if those are generated separately, you might need to convert into Projects also the old revenue and old invoiced amount per project.
Converting historic data also depends on the requirements for future reporting. If you only convert the balance of WIP, you might be missing information for reporting actual cost versus cost budgets, etc.
Dina

Changing the GL Cost Method in the Fiscal Policy

Hi all,
I would like to know what will be the effects if I change the GL Cost Method in the Fiscal Policy. My client wants to go from PPAC to Lot Costing. But I will also want to know what will be the effects if I go from an average cost method to the Standard cost method.
Thank you.

Hello
I am in R11 and implementing R11 , can someone help me with documentation?.
I have defined the lost cost method and assigned it to the GL Cost Method in the Fiscal Policy, when i run the cost update process with the alternate method for lot costing ( Pmac) a warning error displays indicating the Cost Method in the Fiscal Policy is not the same as the one indicated on the actual cost process ( since i have ingredients based on the actual cost method ant not lot controlled i have to run this process previously)
can someone help on this?, at this point im really confused
In advanced many thanks for your help
regards
mariana
[email protected]

Not able to see the Cost analysis in the Process order (T-Code COR2).

Hi SAP Guru's
Csoting in the Process order Configuration.
I have done the Config setting related to the Product Costing Controlling with regard to the
Cost Sheet, Cost Componet Structure.Overheads, asssigning the Cost elements in the Costing sheet.
assigned the same in the Process order.
And also the Costing variant options seen in OPL1 t-code can not be displayed in the Process order Csoting Variant selection.
where as the in the Costing variant for the cost component structure, i can see the Xompany code with required plant details.
looking the costing alanysis data in Process order, unable to see

Hi,
If you are looking at cost analysis. You will get this only some you do confirmations to the production or process Order.
I hope you did confirmation of material and quantities to the Process Order
Best Regards
Surya

Target cost not appearing in process order

Hi All,
Please let me know the reasons for target cost not appearing in process order.
Thanks,
SAP PQ

Two more scenarios:
1. You have co-product.
2. You reverse the variance calculation.
It will show the target cost only after you run variance calculation.

Cost Center, Work Center and Profit Center

Hi ALL,
Can any one please explain me the concept of Cost Center, Work Center and Profit Center.
And where and when do I assign the cost center???
Amit

Hi Check the following "
Cost centers represent areas of responsibility where costs are incurred or where responsibility for costs may be assigned. They represent the smallest unit of responsibility within the organizational structure of an enterprise.
A cost center can be pictured as a cost bucket such as a department, product line, production stage or geographical area.
An unlimited number of cost centers may be created.
All cost centers within on controlling area have to be assigned to a cost center hierarchy (standard hierarchy).
Costs originally posted to one cost center may be distributed and assessed to one or more other cost centers using allocations.
How are costs assigned/posted to a cost center?
External financial accounting documents created in FI, AM or MM that post to a G/L expense account can be configured to require a cost center assignment be entered at the time of transaction entry. The system automatically creates a parallel CO document that posts to the indicated cost center.
Cost elements master records can be configured to be posted to a certain cost center (automatic account assignment).
In addition, other non-financial activity (i.e., direct labor hours) may be posted directly to cost centers from within CO or via other modules such as PP or HR
chandra

Change costing method from Moving Average to Standard costing

Hi Expert
I need to find out the prerequisites for changing the valuation method of an item from Moving average to Standard costing.
(In the forums i found a note which discusses the change of costing method from FIFO to Moving average.)
It would be greatly appreciated if i can get a reply ASAP
Thank you
Regards
Apsara

Hi Son
Let me rephrase my previous question as i have asked it incorrectly.
Step 1. Make all quantities of the stock zero and also close all Open PO, SO etc
Step 2. change the inventory valuation method
Step 3. Enter new stock prices for the standard cost through stock revaluation. My question is can this be (step 3) done through DTW
Thank you
Kind Regards
Apsara

HT4914 How does the payment method work for iTunes Match?

How does the payment method work with iTunes Match. For example, if you have a gift card, does it take it out of that. Or is there tax? What if you cancel your subscription in the middle of the year, does it take the money for that year or not? If someone could answer those questions it would be greatly apreciated. And if anyone has their own questions, feel free to ask. Thank you.

Hi HLFrank,
Welcome to Adobe Forum,
You can opt for monthly payment in a yearly contract or pay at one go for an year.
Please check the option at http://www.adobe.com/in/products/creativecloud/buying-guide.html
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Rajshree

BAPI call to actual cost of work order

Is there a BAPI call to actual cost of work order operations in PM?
I am looking for to read these actual cost in a PM order and populate the data to the none-SAP application.
Any helps appreciate it.
Tim

I think I have just found it:
IBAPI_ALM_ORDERCOSTS_READ
But, thanks anyway for your quick reply and helpful tips.
points rewarded.

Production: "Opening Balance for outstanding work in process (work order)"

Hi, can anyone help me on how to input opening balance for outstanding work in process (work order) in SAP Business One? Thanks.

Hi Suda,
Yes, i have been discussing that issue with my friends and we have the same idea about using production order (the same as your idea). With your opinion, we are more confident to apply it.
Btw, do you have any sugestion if there are differences between legacy system WIP and SAP Business One WIP which is generated by production order (issue for production).
Thank Suda.
Arin

Costing Method / Work in Process

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