Free goods accounting

dear all,
We are facing one problem in free goods scenario.
i.e: higher level line item is a sale and values are passing to accounts.but free goods for the higher level line item is not a sale it s issued as free.
now question is whether free good item value should pass to accounts or not????????
In billing ,free good line item is showing zero value. but it is posting values to accounts.
but our client wants free goods not to be posted to accounts as it is not a sale item.
is there any documentation on this  if any?
thanks
shankar

Hi,
Free goods also will have pricing as performed for the normal (higher level item) and all the sales revenues and sales deductions like discounts will be updated in the respective GL accounts. You can observe this in the item conditions of that particular free goods line item. After calculating all the values finally the R100 condition types determines 100% discount.
Again as per my understanding Do Inclusive Free Goods so that the value for the items which are having calulated will only post into accounting.
Thanks,
raja

Similar Messages

  • Accounting Entry IN Free Goods Scenario

    Hi Gurus,
    Could you please tell me , what  is the accounting entry in Free Goods scenario ?
    Advance Thanks to All .
    Regards,
    Aditya Kumar Patra

    Hello Aditya,
    For Free goods we use R100 condition type for 100% discount.
    when invoice  is posted system post credit entry to Revenue account for price condition PR00 and other components in pricing as we post for normal sales invoice.
    For R100 condition type system  debit the account for free goods account which can be expenses account .
    At the end customer will not be debited so there will be no receivables against customer.
    accounting entry will look like as below
    Revenue account  Cr
    Free goods account     Dr.
    Hope it will help.
    ATP

  • COGS update on other GL Account at the time of Free goods or Sample goods

    Hello,
    In sales process, Usually the at the time of Delivery, material document is created as
    DR COGS
    CR INVENTORY
    But in the case of free goods or bonus goods or samples: the account should not determines COGS instead it should determine another GL Account called as Free good -COGS expense A/c.
    How can we solve the issue.
    Regards,
    SK

    Hi Yasar,
    You need to create a new routine for calculate type.
    Do as below:
    1. Go to VOFM>Formulas>calc.rule Rebate InKd to create a new routine for calculate type.  for example 601.
    2. add the following code in this routine 601 and then save.
      USING L_FRM STRUCTURE KONDN_FRM.
    DATA: VORKOMMA  LIKE KONDN-KNRMM,
           NACHKOMMA LIKE KONDN-KNRMM.
      L_FRM-NRMENGE = 0.
      L_FRM-NRRUND  = 0.
      L_FRM-NRMENGE = ( L_FRM-MGLME / L_FRM-KNRNM * L_FRM-KNRZM ).
    business rounding
        VORKOMMA = FLOOR( L_FRM-NRMENGE ).
      L_FRM-NRRUND  = L_FRM-NRMENGE - VORKOMMA.
      L_FRM-NRMENGE = VORKOMMA.
    3. Select routine 601 in field "Calc.Rule" when you create free goods condition record.
    Hope it helps.

  • Unable to cancel Billing due to cleared accounting document for Free Goods

    Hi,
    I have a case as described below:
    I.                    SALES ORDER CREATION
    Transaction VA01 à Sales order is created for the following details:
    1.       Material Normal  (TAN) : 100 CAR
    2.       Free Goods (TANN) : 10 CAR
    II.                  Subsequent processing of sales order 
    a.       Delivery(1) and Billing (1) creation for the SO with the following details :
    Material Normal (TAN) : 100 CAR
    Free Goods (TANN) : 5 CAR
    Status of accounting document after releasing billing document to Accounting: Not cleared
                    Accounting Journal:
                    A/R                                                                     xxxx
                    Sales discount                                                     xxxx
                                    General Domestic Sales                                        xxxx
                                    VAT u2013 Out(TAX)                                                    xxxx
    b.      Delivery (2) and Billing (2) is then being made for the leftover item of the Sales Order:
    Free Goods (TANN) = 5 CAR  
    Status of Accounting document after releasing billing document to Accounting: CLEARED
    Accounting Journal
    Dr. Sales Discount                                        xxxx
                            Cr. General Domestic Sales                  xxxx
    III.                Reversal of Billing (2) needs to be done
    Activities conducted:
    a.       Go to VF11 and enter Billing (2) document number
    b.      Execute!
    System response:
    Error Log:
    1)      Data inconsistency during processing of document xxxxxxx
    2)      The Billing Document xxxxxxx  is already cleared
    From the error found, we tried to reverse the cleared accounting document by using t-code FBRA:  
    System response:
    Document xxxxxx IS NOT  a clearing document
    Question:
    We have to reverse the clearing document first in order to cancel the related billing document but we keep finding this error, do Anyone have any advice to solve this issue?
    We have simulated similar transaction in IDES and no problem is found, is there any specific setting in customizing that can allow cancellation of billing document regardless of its accounting document status (Cleared or Not Cleared) ?
    Thanks in Advance,
    Indro

    Thanks a lot for the reply,
    It answers my question, I found the copying requirement using routine 029 was defined in the cancellation document section of the Billing type to be cancelled
    After removing, the billing document can be cancelled
    Thanks,
    Indro

  • Posting the Expenses of Free Goods

    All SD Gurus
    I have some doubt in SD-Module.
    We have Trading Business, in that the Trade offers ie 100+10 Like that.... is presently posting in VPRS - Cogs (During PGI) only. But finance wants to post the values of trade offers (10 pcs) to Marketting expenses (During Bill Release to Finance), Presently during Bill release these trade offers are not considered for pricing.
    According to my Current setting Free Goods Item Category is marked as Statistically. So it not posting my PR00 Conditions in Accounts.
    Any help on this subject will be highly appriciated.
    Thanks in Advance
    Regards
    Vishal

    Thanks, I have maintained all setting for Free goods. System is not posting any values @ time of Invoice in accounts as my free goods Item category is statistical. If I remove this setting then I have to maintain the PR00 - Base Condition (Mandaotry) which will post amount in Sales Domestic G/L Account.
    Any alternative solution?
    Regards
    Vishal

  • Tax Calculation of free goods

    Hi
    We have a requirement where the client wants only VAT to be posted in GL accounts and not the price.For this I tried free goods condition type R100 with AltCBV 28.But the VAT value is also coming zero. I want the VAT to be calculated on Pricing condition and then give 100% discount.
    Apart from this I also tried to make pricing condition statistical and calculate VAT on it but then also system gives zero value for VAT.
    Also wondering if the scenario can be addressed with Free of Change Dellivery.

    Hi
    Normally in scenario where you are dealing with samples , there are cases you have to charge only TAXES / EXCISE part.
    Here my SUGGESTION is you can handle this through a simple sales order process, where you have to configure a new pricing procedure.
    1. Create a new document type to handle samples.
    2. Create a New pricing procedure where you can keep the basic price condtion as Statistical and rest all same as wht is is there your main pricing procedure. Just juggle with the TO-FROM to capture the TAX part in the total.
    3. Doc pricing procedure will help you to pick the new Pricing procedure
    4. Now Process this as a normal sales order
    5. This new document type will help you to have a proper reporting.
    The only constraint here is USER has to punch a fresh order seperately for such scenario. He cannot give a free good in the same sales order which is used as standard.
    The other way is you can configure a FREE GOOD Determination procedure as suggested  where you need to then have your Single pricing procedure accomodating the same scenario.
    Thanks
    RB

  • Return of Free goods item - Problem in item category

    I am trying to create return order of Free sample billing
    (ZFDP). The return order type for the free sample is ZFDR.
    We have specified Item category for the ZFDR is RENN (Free good item) in IMG Activity -> Assign Item categories.
    When I create order and save it, it prompts me to enter G/L Account.
    This material is free. It should not prompt G/L Account for it. There is no revenue recognition specified for the item category. I tried changing item category to ZKLN i.e Free of charge item. This item category does not prompt for G/L Account while creating order. but I can not use this item category because it prompts me for Avialability. I can not remove the Avaialabilty check for it because the same item category is used in the Free sample order where availability check is required
    In ZFDP order type, we are issuing 100% discount by using R100
    discount condition.  Please let me know how can I solve this problem.
    I think there is some problem in my item category itself. .
    My setting for Item category in IMG - Define item category is
    same for both ZKLN and RENN. Only difference is RENN has returns
    tick and pricing field is blank. In ZKLN pricing is defined as B- 100%
    discount. I also tried changing the pricing option of RENN to B.
    But still it is asking for G/L Account.
    I can not use ZKLN instead of RENN because my ZKLN is used in the
    Free item Sales order.
    Please help.
    Regards
    Saurabh Gothivrekar

    Hi
    I got answer to my query. YOu need to specify the bill type while defining sales document type. This bill type should not have account assignment mentioned in it.
    I changed the bill type, which does not have Account assignment procedure attached to it.
    It has solved my problem

  • Concept of Free Goods in Scheduling Agreement ?

    There are two line items with same material but different quantities.
    The user has given a price for both and created a SA.
    Then the user comes to know the line item 2. is free goods.
    So then he/she wants the net price of line item 2. to be zero.
    In order to do so, the user went to item conditions and entered PB00 condition type as Zero value.
    This was saved but the user was unable to do GR.
    I tried to use Net discount condition type and gave 100%, it din't help to do GR.
    I tried to create a condition record with free goods, it din't flow in SA, but it works with PO.
    So guys, help me with this !!
    Warm Regards-
    Bharath Anandan

    Hi AKPT,
    Its true, removal of IR indicator will lead the price to be zero.
    But in configuration, account assignment takes care of indicator IR & GR.
    In my project, there is no account assignment which has GR & IR without check.
    But Thanks for your info.
    It was v.helpful

  • Cost of free goods in header

    dear all
    i have configured free goods,in the order the cost is coming for free goods at item level and it is not adding  to the header cost total.
    for eg:i have 2 items and 1 free item.costs r 300,400,500 respectively.
    in the header it is showing only 700 as cost.
    i observed the inventory doc is posting correctly with 1200(which includes free goods cost). 
    can anybody tell weather it should add up or not and how it can be done??
    thanks
    reddy

    Dear Yugandhar
    Check
    SPRO->Sales and Distribution->Basic Functions->Free Goods->Control Free Goods Pricing->
    Control Pricing For Free Goods Item Category you will find statistical value
    or in VOV7 below pricing you find statistical value
    Statistical values                                                                               
    Indicates whether the system takes the value of an item into account 
        when it determines the total value of a document.                    
    There are three options                                                              
          System will copy item to header totals                  
    X     No cumulation - Values cannot be used statistically     
    Y     No cumulation - Values can be used statistically                                                         
    Check if it is initial for your item category
    Standard for TANN is initial and pricing is B     Pricing for free goods (100% discount)             
    Do give your feedback
    Regards
    Jitesh

  • PO Creation of free goods for intrastat reporting

    All,
    Due to intrastat reporting restrictions, when we are creating a PO with a free good we need to mark the item as "Free Good" on the item overview, and set the "Business Transaction type" to 41 on the "Origin / Destination / Business" tab of the "Import" tab.
    However, we also need to set the "Statistical value" on the "Decleration Values" tab but this field is greyed out.
    The help message says:
    The system determines statistical values on the basis of condition records with condition types GRWR and GWLB (subcontracting).
    However it does not say where I can set this value. Does anyone know where I can set this value per material?
    Many Thanks,
    Colm

    Can you explain why subcontracting is free of charge, I have never seen somebody doing some work without charging for it.
    are you talking about the delivery of the materials sent to your subcontractor or the finished materials that you get back?
    Usually the statistical value field can be maintained in VEFU. But I guess it interacts with the free of charge indicator in your case.
    I just like to give you some explanation from the statistical office:
    u201CProcessing under contractu201D covers operations (treatment/processing, mounting, assembly, enhancement,
    renovation, etc.) resulting in the production of new or really improved goods on the basis of intermediate
    materials provided free of charge by the commissioning party. Depending on whether processing under
    contract is done within the country or abroad, the relevant terms used are u201Cinwardu201D and u201Coutwardu201D
    processing under contract.
    u201CProcessing under contractu201C in the context of intra-Community trade statistics covers intra-Community
    cross-border movements of goods, provided the finished products produced on the basis of the
    intermediate products provided through cross-border transactions will later leave the country of
    manufacture (dispatch), being either returned to the original country of consignment (arrival; nature of
    transaction u201C41u201C or u201C51u201C) or moved to another country (nature of transaction u201C42u201D or u201C52u201C).
    What must be declared is both the cross-border movement of the (free) intermediate materials and the
    subsequent (cross-border) return of the finished products.
    (Note: Processing performed by the processor on own account is not processing under contract but is
    generally covered as purchase/sale (nature of transaction u201C11u201D.)
    For the declaration of the intermediate products provided free of charge (nature of transaction u201C41u201D), a
    statistical value has to be indicated that corresponds to a selling price customary in the market (free
    German border); in case of doubt a careful estimate should be used. When declaring the finished products
    (nature of transaction u201C51u201D), the invoiced amount to be indicated is the costs of wage, material, transport
    and insurance as invoiced by the contractor; for the statistical value, the statistical value of the
    intermediate materials (provided free of charge) must be included, too.
    (Note: Intermediate products returned to the commissioning party without treatment should be declared
    under nature of transaction u201C51u201D, entering the value originally indicated.)
    If, however, the commissioning party provides only parts that are insignificant in terms of function or value
    (e.g. labels, screws, etc.), then there is no processing under contract. In those cases, such provision of
    materials that is negligible in statistical terms is exempted from declaration for intra-Community trade
    statistics. For the finished product supplied on a cross-border basis, a sale or purchase (nature of
    transaction u201C11u201D) is regularly assumed, with the value of the materials provided free of charge by the
    commissioning party exceptionally not being included when determining the value of the finished
    products.
    Also, there is no processing under contract if the contract work performed at the goods provided consists
    of just simple activities (e.g. simple packaging, ironing, etc.). In such cases the goods exported or
    imported temporarily within that scope are not covered statistically.
    Examples:
    1. A sports car is moved temporarily from Italy to Germany for tuning activities (e.g. power increase,
    car body modifications). What is invoiced in addition to the labour costs is some car parts
    purchased by the domestic contractor.
    As the sports car is u201Creally improvedu201D by the work performed, this is u201Cprocessing under contractu201D,
    which has to be declared under nature of transaction u201C41u201D for arrival and u201C51u201D for (re)dispatch.
    2. For the production of a car in the Czech Republic, the engine gearbox unit and some other parts are
    provided free of charge by the commissioning party located in Germany. For the import of the
    complete car to Germany, the foreign producer invoices the car without the value of the engine
    gearbox unit.
    This is u201Cprocessingu201D of important components (both in terms of value and function) in connection
    with the production of a u201Cnew goodu201D (car), i.e. the transaction u2013 by definition u2013 must be declared as
    u201Cprocessing under contractu201D both for dispatch and for re-arrival.
    3. For the production of an off-road vehicle produced in Austria, the German commissioning party
    provides the company emblem free of charge. When the complete vehicle is imported to Germany,
    the foreign producer of the off-road vehicle invoices the vehicle without the value of the company
    emblem mounted on the vehicle.
    Although the components provided are u201Cprocessedu201D, they are insignificant parts (company
    emblem) both in terms of function and value, so that this is not u201Cprocessing under contractu201D but a
    purchase (nature of transaction u201C11u201D) of a vehicle.
    4. An older car is temporarily moved to Poland to restore the paint (washing, polishing and
    conserving).
    This is not u201Cprocessing under contractu201D in the context of intra-Community trade statistics because
    the work performed consists of just simple activities. As this is u201Ctemporary useu201D, the cross-border
    movement of the vehicle is exempted from declaration.

  • Free Goods Should not down MAP -

    Hi, MM / FI Gurus!
    We have a scenario where Vendor offers a Discount in Kind. For e.g. For Order Qty over 1000 Pcs vendor offers 10 Pcs free over each 100 Pcs. Assuming PO price as 10 units then for 1200 Ordered Qty vendor delivers 1200 + 120 = 1320
    In PO the Free Goods are determined correctly (in either cases whether Inclusive / Exclusive). Order quantity in first line has a gross price determined. The second line tiem in PO has Free Goods Quantity determined as per procedure for Discount in Kind, with zero price.
    When we do GR the Inventory is up by Order Quantity + Free Goods Quantity.
    Automatic posting in MM determines the GL correctly.
    Dr Inventory - Drugs and Meds: 128010 Amt 12000 Curr            
    Cr GR/IR Clearing:                               200060 Amt 12000- Curr
    As expected MAP goes down due to Free Goods (Zero Price)
    Client wants to up the inventory for by Order Qty + Free-Goods Qty but this should not down the MAP as well.
    I have activated Direct Posting to G/L Accounts and Material Accounts for Incoming Invoice
    Idea was to Credit Gross Price on the Free goods Quantity to Inventory - Drugs and Meds: 128010 to make up the MAP in material master and Debit the same amount to Other Income as follow:
    Dr GR/IR Clearing: 200060 Amt 12000 Curr
    Cr Vendor Account:                          200001 Amt 12000- Curr     
    Dr Inventory - Drugs and Meds: 128010 Amt 1200 Curr (Free Goods)
    Cr COS-Drugs & Med:                         500100 Amt 1200- Curr (Free Goods)
    However we cannot post Gross-price for Free goods Directly on the same GL(which has Automatic posting Checked) to Up the MAP (which falls down because of free goods having zero price).
    Is there any way in FI to have both Automatic and Manual posting for the same GL?
    Also I am not sure that after we do this if MAP will be Up.
    Is there any other way may be by using Movement Type for such Movements?
    Thanks
    Atul Sonalkar

    Hi Atul
    Create PO only for the material for which you are going to pay your vendor.
    ie., for 1000 units @ Rs. 12 = 12000.  Post GR.
    Now you are getting 100 units free. Don't enter this in your existing PO. Create a new PO for the free goods and post GR.
    Your MAP related problem will be solved.
    Regards
    Rajesh
    Do reward if this is useful.

  • Free Goods in PO

    Dear All,
    I have scenario kindly help me out for this,
    i created an import PO for import material i ticked the free goods and add the conditions (frieght in values and freight in %) in the header. i recieved the goods through MIGO which shouldn't create accounting document thats fine but when go to MIRO system is not pulling up the conditions in the MIRO screen even the tab of MIRO screen on Planned delivery costs. kindly support me for this scenario. i want to recieve good free of charge but i want to pay the planned delivery charges.
    Regards,
    Qasim

    Hi mohemmad,
    have u checked GR nonvaluated indicator for PO ?
    if this is set no accounting document generated at the time of GR,
    and check the IV indicator is set or not ?
    check the vendor schema group and purchasing schema groups are asigned or not ?
    if helpful reward points
    rgds
    lakshmi reddy

  • Free goods PO query

    Hi Gurus,
    Sometimes we imported the goods as free. Although we did not pay anything to the vendor, we should pay custom and transportation expense to the related vendor.During PO creation in SAP, we are entering custom and transport expense as condition and we are selecting related vendor in the condition tab.
    Inthis step , when we selected PO line as pay free, system deleted conditions automatically.
    Can you please advise how to make payment of custom and transportation expense  in case of free goods??/
    Regards,
    Subbu

    Hai,
    To my knowledge you cannot enter conditions for free goods ,but for that we can enter the customs and transportation charge
    refering that PO in invoice verification as planned delivery charges are to directly to GL account.
    Regards

  • Free Goods Problem and User Exit if needed in Sales Order

    Hello All,
    The problem is related to Free Goods in Sales Order which is given with an example -
    We have maintained Free Goods ( T Code - VBN1) in inclusive scenario which is as follows -
    For 210 PAC (Pack) of Material A 18 PAC Free.
    Where 1 PAC = 20 BT (Bottle) and 20 PAC = 1 CV (Case Pack)
    In the material master of Material A the Base Unit Of Measurement (UOM) = PAC and Sales UOM = Blank so that we can use any conversion factor maintained for the material.
    The conversion factors maintained for Material A are as follows -
    1 BT = 1BT
    1 PAC = 20 BT
    1 CV = 20 PAC
    Now when we are raising sales order for 11 CV the free goods are not generated in the Sale Order.
    Again if we maintain the Sales UOM in CV and raise the sales order it is showing :
    10 CV as main item and 1 CV as Free which is wrong because in the conversion factor we have already maintained 1CV = 20 PAC , Whereas in the inclusive scenario it is given 11CV = 210 PAC and 210 PAC = 18 PAC is free.So in any case it is taking into account 2 more PACs.
    Please suggest what need to be done in this case in respect of User Exit or Source Code in ABAP if needed.
    Thanks & Regards
    Priyanka Mitra

    Hello Priyanka Mitra,
    We are facing a problem same as you.
    How did you solve this problem?
    We are very glad if you teach it concretely.
    Please advise your solution to us.
    Thanks.

  • Free Goods Problem in Sales Order

    Hello All,
    The problem is related to Free Goods in Sales Order which is given with an example -
    We have maintained Free Goods ( T Code - VBN1) in inclusive scenario which is as follows -
    For 210 PAC (Pack) of Material A 18 PAC  Free.
    Where 1 PAC = 20 BT (Bottle) and 20 PAC = 1 CV (Case Pack)
    In the material master of Material A the Base Unit Of Measurement (UOM)  = PAC and Sales UOM  = Blank so that we can use any conversion factor maintained for the material.
    The conversion factors maintained for Material A are as follows -
    1 BT = 1BT
    1 PAC = 20 BT
    1 CV = 20 PAC
    Now when we are raising sales order for 11 CV  the free goods are not generated in the Sale Order.
    Again if we maintain the Sales UOM in CV  and raise the sales order it is showing :
    10 CV as main item and 1 CV as Free which is wrong because in the conversion factor we have already maintained 1CV = 20 PAC ,  Whereas in the inclusive scenario it is given 11CV = 210 PAC and 210 PAC = 18 PAC is free.So in any case it is taking into account 2 more PACs.
    Please suggest what need to be done in this case in respect of SD  /  ABAP(if needed).
    Thanks & Regards
    Priyanka Mitra

    Yes Priyanka
    This is a very interesting  and a challenging issue or question
    I think because of the prorata calculation type the extra 2 units  is coming
    This logical  error has happened to me too
    Inclusive 210 units  means we have defined as 192 + 18 in VBN1
    But the system determines the free goods in sales order as 190 + 20 that means there are 2 units which are going free than what has been maintained as condition record
    But system converts our logic into its own thro that calcultion type PRO  RATA which is the main culprit here
    So it requires ABAP help
    This qn should be awarded points (unfortunately i am not able to do so)
    Regards
    Raja

Maybe you are looking for