Free of Cost Sales - TANN

How does a company account for the Costs of the Free samples been given to the customer.
Free of charge sales order will have no biling effect but how is the costs been taken care in acounting/costing perspective.
Thanks!
A S

Fyi,
If its regular sales or free of charge sales, Outbound delivery has to create to dispatch the goods to the customer. While issuing goods via OBD with Mov type:601, cost will be captured through accounting documents.
can you confirm, whether you want to capture the cost or  price in FOC sales??
Assume, that we capture the price in G/L accounts after releasing Invoice to accounting, not the Cost.  If you want to track FOC sales, you can very well use the std reports:VA05N with document type specific.

Similar Messages

  • Free of cost sale in Manufacturing

    Hi,
      We have one manufacturing plant, as when we create the invoice the customer account is debited and the excis etax account are creadited now in case of free of cost sale we required that insted of customer we have a different GL account the total invocie amount of inovice should be debited to that GL account insted of customer and the tax account should be credited as per regular process, so what setting cam be done to this, but SO, delivery and billing shold be done on customer name only.
    regards,
    zafar

    Hello
    Your most of the requirement should get solved by use of Item Cat TANN.
    I hope the following SDN thread will be a good referenc for your requirement.
    - free goods Accounting
    - Excise in free goods sale
    Regards
    JP

  • Free of Cost   sales  error during billing

    Dear all,
    i am facing the problem while doing Free of Cost sales  ,   i have created a seperate document order type for FOC  with the sd document category  as  "C" and  and  doc prcing porcedure  as "C"  .  and in billing document   i have also included  doc prcing procedure as "C" . 
    My problem is  when i create the sales order and when doing delviery there is no problem.. but  when i created a delivery related  billing 
    *the first error i am getting is   document no XXXXXX  ( error in account determination ) but  when i went to VF 02 and put the billing document number to check  account determination analysis  .*
    *i am getting this second  error  " billing document XXXXXX does not exist"*
    *Message no. VF041*
    *Diagnosis*
    *The billing document you specified does not exist.*
    *This document was possibly archived.*
    but when i went i checked in the table level it is the corresponding billing document number is showing in the table
    when i check the document flow of the order  i am not getting the order number also  to see the document flow for it
    wht could be the reason 
    i am confused. 
    my senario  is    foc sales should be done   the customer should not be debited but excise entry has to be made for it.
    please give ur valuable inputs
    Edited by: k.kumi on Aug 8, 2010 7:06 AM
    Edited by: k. on Aug 8, 2010 7:40 AM

    Thanks for your reply
    your absolutely right,  i have used FD document type and i have  created a proforma invoice  so that i can have a excise posting done for the particular materials , because  since it should  excised .
    i have a billing type  with  SD document category as "U"  for proforma invoice . 
    here everything is happening like  sales order is created , PGI is happening and when it comes to delivery related billing
    The system cannot able to able to save the data during billing.
    the system is saying an error  "billing document XXXX does not exist"
    since i am creating a proforma invoice atleast i need to have the billing document number generated to do the exicse posting
    Is it related to number ranges problem ?
    Kindly  reply me , waiting for your reply in anticipation
    thanks

  • COGS determination for Free of cost sales order

    Hi All,
    We have an issue regarding the COGS determination for Free of cost sales order. We created a free of cost sales order. But i need to know whether this sales order items will hit to COGS or not? If so how do i check whetehr its has been charged to COGS or not? and we have an issue raised saying thst one material in this sales order has not being charged to COGS. So please help me to solve this issue. Ihave checked the account assignment in GBB-VAX. And is there anyting to do with the settlement profile for COGS determination?.
    Thanks and regards
    Uday

    Hi,
    During PGI a material document and accounting doc gets created which would hit COGS account.
    You're talking about one specific sales order in which for one material it didn't hit COGS account or any order you're creating now with that material has an issue? If its a specific material which has an issue always..then something is wrong with that material master setup. Also you can go to the reported Sales order--doc flow to the PGI document and check the accounting doc and if its not posted..check the analysis why its not posted?
    And if its one off then I would suggest 2 options:
    1) Reverse the goods movement, cancel the delivery or if billing has already been done..cancel the billing as well. And re-do the cycle. This always ensures correct posting.--> Recommended option.
    2) Manual adjustment in FI.
    And settlement profile is Controlling concept..not sure you would get any help on this in this forum.
    Regards
    RS

  • Sales Commision / Free of Cost Sales Report

    Dear Experts,
    Is there any standard report in SAP to get the details of all sales created under "Sales Commision" / "Free of Charge" sales order.
    Sold Party - Quantity - etc
    Thanks

    Dear Simon John,
    There is no such standard report.
    Either you can use VA05 and select ALL ORDERS and then FILTER it based on your document type for FOC .
    Or else you can create a QUERY with VBAK-VBAP table join.
    Thanks & Regards,
    Hegal K Charles

  • Sales Quotation - Items free of cost

    Hi,
    In my sales transaction I am giving some items as free of cost. These items are inventory items. The price of this free item should be displayed but at the same time it should not be added in final total.
    How to do this?
    uday

    Hi Uday,
    Are you using any excise tax code for this free of cost sales? If not then you can use Assessable Value field to show the unit price.
    Last option will be to create one UDF.
    Hope this will help you.
    Regards,
    Abhishek
    Edited by: Abhishek A on Dec 4, 2008 3:32 PM

  • Free of cost item sale.

    Hi all,
                It is a my claint urjent requirement free of cost item sales where we will define that, what is the order type, how i have to explain  them any body plz give me some help .
       Thanks in advance for your support and help.

    hi,
    am not sure if understood your requirement. But anyways, we have sales document type FD which allows free of charge deliveries.
    You can uses a free of charge delivery to send materials free of charge to your customer.
    Process Flow
    The system cannot create a delivery without a sales document, so you have to create a free of charge delivery as a type of sales document.
    You create a sales document with the order type for free of charge deliveries.
    In Customizing you can block the free of charge delivery from being delivered. Go to Sales > Sales Documents > Sales document header > Define sales document types, and select the Delivery block field in the Shipping section.
    For free of charge deliveries, you can do one of the following:
    Approve it by deleting the delivery block.
    reject it by entering a reason for rejection.
    Pl clarify if this what you are looking for.
    Thanks,
    Sadhu Kishore

  • Giving BOM material as free good in Sales Order

    Hi,
    I have a business requirement.
    I want to give a free good in Sales Oreder which is a BOM material.This should be possible by manually changing Item category for the line item in the Sales Order just like how we can change TAN to TANN in normal circumsatnces when we add free good material for any NON BOM material.
    In standard functionality,the item category determined for this BOM material is TAQ but this item category field in Sales Order is non editable because of which I can not include the BOM material as free good in my sales order.
    I have already defined one z Item category for free goods for this BOM material & want to use it in Sales Order.
    Can you please suggest how this can be handled ?
    Or is there any other work around by which will allow me to include BOM material as free good in my Sales Order ?
    Thanks in advance
    Regards,
    BM

    Hi,
    Thanks everyone for the feedback.I agree with Samir Danish.It is a standard functionality of SAP which does not allow free goods for BOM material.
    However, can someone suggest work around to deal with this issue.I mean if any one has been doing any work around for this issue then please let me know.It s becoming critical for me.
    Regards,
    BM

  • Free Goods Without Sales Order

    Dear Gents
    We have a scenario where goods are issued for free without a sales order,it's not considered sales,they just give some materials out from the stock as gifts&issue it on a cost center , there is no sales order,invoice,etc..is it normal then that the accounting entry passed would be Dr Cost Of Goods Sold Cr Inventory or what should be the correct scenario , Thanks.

    Dear Expert,
    When Goods are Given as gifts or Samples it becomes an expense for the company. So in my view it has to be shown as an expense.
    The Accounting Entry would be :
    Advertising A/c ....Dr
            To Purchases A/c ....Cr
    Regards,
    Shankar K B

  • Report for the cost for replacing the defective goods free of cost

    hi guru's,
      iam having the qury that iwant to create a report for the free of cost .For the senario that company wants the report for replacing the defective goods free of cost .pls help me out .IN SD module
    Edited by: joe mm on May 13, 2008 3:35 PM

    Dear joe
    I am sure, for giving free of cost, you should be having different document types like sale order for free goods, billing with no value.  So thru VF05, by selecting the billing document type, you can generate a report.
    thanks
    G. Lakshmipathi

  • To replace defective goods free of cost if it is brought back

    Hi all
    can any one suggest me how to go about this scenario
    how to replace defective goods free of cost if it is brought back within 6 months of the invoice date.
    what is the process
    thanks in advance
    sri

    Hi,
    To replace defective goods a return process with a free of charge SO and delivery must be in place.
    Process:
    1. Create a returns sales order w.r.t the billing document of the defective goods
    2. Create a returns delivery and do the PGR
    3. Create a Sales Order (new order type or OR can be used) with the replacement qty, please note that the pricing here should be zero.
    4. Do the delivery for this order and PGI.
    5. Please note that billing is not required as we giving the goods free of charge.
    In order to do the above process all the configurations should be in place. The returns SO item category should not be relevant for billing, similarly the subsequent SO item category should not be relevant for billing.
    Hope this helps.
    Regards,
    Vinu

  • Returns of Promo material & Free of cost

    Actually we are a pharmacuetical company and we have business scenarios that we give our marketing team promotional material which are free of cost and based on zero value means we maintain their stock in quantities only and also at the time of order processing we donot generate the invoices for such types of orders (due to zero value of order) because the items are already charged of to different departments .
    some times it happens that we need to take back those items from our marketing team in the shape of return order, so my question is that what SAP best practices says about processing return order for such materials, how can i configure my system to process return cycle for those item.
    kindly guruus help me out

    Hi,
    process the return sales order (RE) with reference to FD (your free sales order), becasue u didnt have billing document reference (this is actually sap standard, taking billing document is not sap standard). You definitely have perfect copy controls between OR to RE.  then make sure item category determination settings like below;
    REnormfree+nil=RENN
    and then take PGR.
    this is as per me is the best practice, which is purely SAP standard.
    regards,
    sk

  • Transfer of Free of cost unit at 10% markup to Main product

    Dear Gurus,
    we are consumer products industry and offer bundle scheme i.e. one unit free on the purcahse of one unit.Let assume our main unit is LCD TV and free of cost unit is BD player. both units have common Division and common profit enter. we offer that on purchase of LCD (Sale Price PKR. 100,000) BD Player (COst price PKR 10,000) is free
    now managment wants that when they execute profitiblity report of LCD it should show following figures
    Sales Price of LCD                                                                          PKR 100,000
    Less COst +10% transfer price  of BD player                                         11,000
    Net Sales Revenue of LCD TV                                                                 89,000
    while as we see profitibility of BD player it should show followings
    COst Price of BD player                                                            PKR       11,000
    10% profit margin(Mark up)                                                      PKR         1,000
    Totale Sales Figure                                                                    PKR      12,000
    While At present following figures are being derived i.e.
    Sales Price of LCD                                                                          PKR 100,000
    and net result of BD players is NIL
    Requirement
    Transcational Procedure `to transfer BD player COst price +10% to LCD and how to get above desired figures which are realistic
    BR
    Sajida

    Hi,
    The copy control setting can be made through VTFL
    But not sure about percentage of margin, it will transfer hole cost of free item to main item
    For your requirement in pricing procedure create two conditions for represnting cost
    Say
    PR00 - is for basic price - 100000 
    VPRS - Cost  - 10000
    VPRM - Margin Cost - 1000
    Profit will be 89000
    Now to bring the 10 % cost from free item to main item you have to write routine and assign in pricing procedure aginst VPRM condition
    kapil

  • Question regarding free of cost order

    scenario: i have a client who wants to send 100 qty of good A free of cost to a customer. the customer is only responsible for taxes on this order. how would i do this in SAP? what do i need to create?
    thanks!

    Else,
    you can create your own pricing procedure & use the new sales doc type (DPP).
    10 0 ZPRI - Basic Price  - Statistical
    50 0 MWST  - 10(ZPRI) -   MWS
    so that, Basic Price will not be included for net value calculation, but taxes will be calclulated on basic price.
    try n revert
    NOTE: Make sure, in Incompletion procedure either @ header or Item level, Net value should not be included. otherwise system asks to maintain the price. As maintained price will not be considered in Net value as its Statistical.
    so its recommended to maintain seperate Document type / Item category for all these kind of scenarios.
    Edited by: Reazuddin MD on Oct 20, 2009 3:04 PM

  • Exicse for free of Cost Material

    Hello,
    I have a question regarding Excise on Free of cost Material. When we are sending material to Customer as a sample or free of cost then we do not pass any accounting entry for the same during VF01.
    In the above scenario how do we capture the excise in our system..Please guide me.
    Br,Vivek

    Hi taurian,
    This is very simple.
    in the Pricing Procedure for FOC, shall I maintain the Excise Condition Type as Statistical?
    for this no need to Specify statistical for condition types because after delivery subsequent billing is proforma.because this value should not post to accounts,that's why we create proforma invoice.So even without specifying statistical accounting document will not be generated.
    but as per central department of excise we should pay the duty while goods leaving from factory.So that we should post this excise conditions amount to the accounts.
    So create subsequent excise invoice then accounting document will be generated.system will calculate the excise condition amounts based on basic price you maintained in V/08,system does not bother whether basic price condition type is statistical or not.
    For your understanding:
    Configuration:
    order type FD,Item category-KLN,Schedule line-CP
    Delivery type LF
    Billing type F8 (delivery related proforma)
    Sales cycle:
    Va01>vl01n>vf01>j1iin
    Let me know for further clarifications.
    Thank you,

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