Product costing - Fixed and variable cost.

HI,
I like to know how the cost is divided into fixed and variable at the cost compent level.
as there is only one setting available at Define Cost Component Structure.
Kindly let me know how this is done and possible forward the Product costing document and setting.
my e-mail :[email protected]
With Regards
Krishna Singareddy
Edited by: krishna singareddy on Feb 26, 2008 8:26 PM
Edited by: krishna singareddy on Feb 26, 2008 8:27 PM

Hi, FICO MOH ,
Do u have any logic if a coast element has 100 how do u divide it among the fixed and variable.
what is the persentage or based on what it is defined .
can u put some example pls
with regards
krishna

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Fixed and variable cost component break up in PCA

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Is it possible to get fixed and variable cost component break up and contribution report in PCA at each product group level and lower level of node. I think this requires development. As my client requires the report to have cost break up into fixed and variable in PCA at each line item level. Can anyone solve this

Hello
You can get the report by using the report painter, no development will be required.
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Fixed and variable cost element's cost

hi,
i would like to clarify. need your kind advice.
1) can direct cost has both fixed and variable cost? can have example?
2) can indirect cost has both fixed and variable cost? can have example?
3) direct cost only happens in direct cost center and indirect cost only happens in indirect cost center?
4) can direct cost center assign to fixed cost element and variable cost element? Likewise, indirect cost center assign to fixed cost element and variable cost element?
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Hi,
As per my understanding
Direct cost to a department could be variable or fixed.
Example: A supervisor in the X department would be a direct cost to the Dept A department. Since the X salary is likely to be the same amount each month regardless of the quantity of products manufactured, it is a fixed cost to the department. The supplies furnished to the X department will be a direct cost to the department, but will be a variable cost to the department if the total amount of supplies used in the department increases as the volume or activity in the department increases.
Indirect cost is the Power used to operate a production machine.
Example: The cost of the Power is variable because the total Power used is greater when more products are manufactured on the machine. Depreciation on the production machine is also an indirect product cost, except it is usually a fixed cost. That is, the machineu2019s total depreciation expense is the same each year regardless of volume produced on the machine.
As you can see, costs can be direct and indirect depending on the cost object: product, department. The cost is fixed if the total amount of the cost does not change as volume changes. If the total cost does change in proportion to the change in the activity or volume, it is a variable cost.

Product Costs Split is required, that is fixed and Variable costs

Hi All,
In a Sales Order screen (VA03), if we check the Costing, by clicking on EXTRAS -> COSTING, we get Total Costs, Fixed Costs and Variable Costs.
Can someone please help me in getting these costs, I have used Table KEKO,
In KEKO (filtered based on Material, Plant, Sales Document, Item) and executed it, taken the resultant ProdCstgNo (KALNR)
In KEPH used that KALNR, as a result I am getting 4 records, However 2 records are not correct, and 2 are correct.
In correct ones I have to add few costs to get FIXED COSTS and few costs to get VARIABLE COSTS.
My question is, which filter should I use to get the correct record (probably just one record) ?
Can I in some table get the summed up VARIABLE COSTS and FIXED COSTS, rather that I have to add them seperately ?
Please help, will award points promptly. Thanks

Hi,
In KEKO (filtered based on Material, Plant, Sales Document, Item) and executed it, taken the resultantProdCstgNo (KALNR)
In KEPH used that KALNR, as a result I am getting 4 records, However 2 records are not correct, and 2 are correct.
The table you mentioned CKMLKEPH is used for Material Ledger actual cost components.
Regd,
Khan.

Definition of fixed and variable costs

Hi,
where do I define if a an expense account is a fixed or variable cost element? Do I have to set up separte expense accounts in the Chart of Accounts for fixed and variable?
Can you give me some info of how this is done.
Thanks
Paul

Hi Paul,
You can use the features of Cost Element Attributes and Cost Element Attributes Mix for this.
Pls check OKA4 and OKEC transaction codes for this. IMG -- CO -- CE Accounting -- Master Data -- Cost Elements
Once you create the Attribute Mix, you can populate it in the Cost Element Master Data.
You can describe a cost element with a maximum of eight attributes, independent of the chart of accounts. You can use these attributes for evaluations in reporting.
You can store a valid combination of permitted attributes:
--In the cost element's master data
--In cost center planning for the combination cost center/cost element
Pls revert back for further explanation...
Srikanth Munnaluri

Fixed and Variable Breakup of Actual Cost

We have implemented Material ledger and also activated actual cost component split. We are getting the actual product cost at month end. In the costing cockpit we get the Peiodic unit price(Actual cost) as well as std price of the material. But In costing cockpit we are not able to get the breakup of Fixed and variable. Whereas we are getting Fixed and varible breakup when we check cost component report in ckm3. But there, we can see individual material wise fixed and varibale breakup.
Can anybody help me so that I can see the Actual Fixed and variable cost for all the products at a time?
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Fixed price, is the fixed costs - I usually see it in relation to Overhead..
Fixed costs remain, whether you manufacutre or not.
Say you are deciding whether to out-source an assembly, If you outsource, VARIABLE cost will be saved, Material, labor for that assembly, Overhead representing fringes for that labor, the electricity to run that specific machine. However, you will still have fixed costs of: Management Salary (although some of that can be variable); insurance on the building; heating and cooling for the building; realestate taxes.
If the cost to make "in house" is 150 each and the vendor is going to charge you 100, thi is only a true saving if your fixed costs are less than 50.
SAP allows you to separate fixed and variable costs so that you do make/buy analysis, budgeting, etc
Hope this helps
Edited by: Althea Madigan on May 12, 2010 2:11 PM

Overview report cost estimate (fix and variable)

Hello
anybody knows a overview report where i can see for the current valid cost estimates
per material
costs splitt between fix and variable costs
Alternatively it would be sufficient if this is just shown for a costing run
In CK40N and all other reports i know i have the complete costs but to see details an extra click to the between fix and variable costs is needed and i can not extract to excel.
Or is the only option an query on KEKO,KEPH, CKIS?
Cheers
Tim

Hello
@Sachin: Thanks for the report but the output is not that good - but helpful
@Eric: Thanks this report solved my problem )
Cheers
Tim

Base cost and Variable Cost

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Can anyone help me to understand what is base cost and what is variable cost. And also from where can I find these both.
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Vani

Mayby you mean fixed and variable costs?
Variable costs are expenses that change in proportion to the activity of a business.
For example, a manufacturing firm pays for raw materials. When activity is decreased, less raw material is used, and so the spending for raw materials falls. When activity is increased, more raw material is used and spending therefore rises.
Fixed costs are business expenses that are not dependent on the level of production or sales.
For example, a retailer must pay rent and utility bills irrespective of sales.

Fixed and variable prices of an activity type understanding

Hi,
To my understanding the fixed portion of the price will not be multiplied by the quantity and the variable price will be. However, i tested the cost estimates and it looks like both the fixed price and variable price is summed up together to get the total price and this total price is multiplied with the quantity.
In this case what is the purpose of having fixed price and variable price in the activity type?

Fixed price, is the fixed costs - I usually see it in relation to Overhead..
Fixed costs remain, whether you manufacutre or not.
Say you are deciding whether to out-source an assembly, If you outsource, VARIABLE cost will be saved, Material, labor for that assembly, Overhead representing fringes for that labor, the electricity to run that specific machine. However, you will still have fixed costs of: Management Salary (although some of that can be variable); insurance on the building; heating and cooling for the building; realestate taxes.
If the cost to make "in house" is 150 each and the vendor is going to charge you 100, thi is only a true saving if your fixed costs are less than 50.
SAP allows you to separate fixed and variable costs so that you do make/buy analysis, budgeting, etc
Hope this helps
Edited by: Althea Madigan on May 12, 2010 2:11 PM

Differance betwen Variable & Fixed and Variable in Cost Component Structure

Dear All,
What is the difference between the Variable and Fixed and Variable for the cost component for the Cost Component Structure.
why we have to take Raw Material Cost Componennt always Variable. Is any help?
Regards

fixed cost is irrespective the level of production the cost remains same. or upto certain level of production the cost the cost will ramain same and after the cost may increase.
example: rent of the factory building or office buildings remains same irrespective of the operations level.
variable is with every change in the level of production the cost change.
example: raw material used in manufacturing finished product. The more finished products the more is the consumption of raw material.

Table for Production order planned and Actual cost

Hi Experts,
Can anybody please tell me the name of table where Production order planned and Actual cost gets saved ?
Thanks in advance.
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Bijay

Table COEP
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Budget Report to show the fixed and variable split for Materials

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Could you tell me if there is a budget standards report that will show the fixed and variable split for Materials? Example: Labor, Equip., QC and Overheads?
I need it for the correctly rolled-up 'final material number' step. The report that does this now (without fixed and var split) is the Indented BOM Comparison (sret - cost mgmt-product costing - cost mgmt-customized reports - cost estimate comparison - costed multilevel compare rpt - Indented BOM Comparison).
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one simple way is in your final itab declare a slno type i field
data : begin of itab occurs 0,
slno type i,
<other fields>
end of itab.
after filling the data in itab.
loop at itab.
itab-slno = sy-tabix.
modify itab.
endloop.
in fieldcatalog also you have to define that slno field as the first column.
but it will change its order if you are sorting the output or filtering the output.
regards
shiba dutta

Examples for Fixed and variable prices for activity type

Hi,
Can someone please provide a real life example for the fixed and variable prices of an activity type?
Moderator: Search SDN and SAP help material

Hi,
Fixed Price are those expenditures which remains constant in total amount irrespective of change in Volume of production.Eg Rent will be constant even if your production volume changes.The activity price calculated for such expenditures will also be constant per activity rate even if there is a change in the volume of production.
Varriable price on the other hand changes with the volume of production .e.g power cost will change if you produce more.the the activity rate say KWH/ton will also change and its price will also change if you produce more.
Generally activities for service center fixed costs will yield fixed price.
Once you are done with planning in KP26.these plan amounts are used for standard cost estimate.when you are doing standard cost estimate, cost will calculated from BOM(Materials cost) and Routing(here you have activitype plan cost/hr.no.of hrs to finish goods).
once you are with standard cost estimate it will update material master.
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you can check this in OKV6 T.code.
Thanks,
Rau

Fixed and Variable Overhead

We are using standard costing and with only one Overhead Resource - we would like create a Fixed and Variable Overhead Resource - we have tested adding 2 new resources - but when we run the Assembly Cost Update - for WIP it revalues the jobs as if they had no Overhead at all before - does any one have any help to offer on the correct way to make this change and revalue WIP correctly?
The change is correct for a part when you view the item cost and the Inventory onhand is revalued correctly.
Thanks
Pam

Pam,
Did you review the output of the WIP Standard Cost Adjustment report after the standard cost update to see how the wip inventory was updated? I would suggest that you get the following to verify if the cost update is not updating wip correctly:
-The WIP Standard Cost Adjustment report this is created when a standard cost update is performed
-The log file of the Standard cost update with the debug profile options MRP:Debug option set to yes and CST:Cost update Debug level set to Full
-The output of the Job.sql (see note 378348.1) for a job that the standard cost update is being performed against both before and after the standard cost update
-Screen shots of the resource set up and cost that is being changed
-Screen shots of the Item Cost of the frozen cost type and the cost type that the cost is being updated from.

Costing run and premilinary cost estimate

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Is it possible to run cost estimate and premilinary cost estimate for a product cost collector back dated. I mean for 01.03.2007. I know it is not possible. But anyother way out.
ranga

Hi Rangarajan
I think it is possible in future date and not backwards.
Thanks
Ashok
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Product costing - Fixed and variable cost.

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