Significance of Preliminary cost estimate,

Hi experts,
My clinet is using REM scenairo and in REM profile we have maintained "Backflush using standard cost estimate". My question is in this case what is the significance of preliminary cost estimate(PCE)? and I would able to confirm (MFBF) without running
PCE.
Please let me know is it mandatory to run PCE in this case.
Thanks in advance.
Purushotham...

Dear Puru,
WIP in REM is calculated at Target Cost. Valuation variant for target cost is generally preliminary cost estimate for the material and production version combination. However, if you want to valuate the work in process and scrap at the target costs calculated on the basis of a standard cost estimate, do not create a valuation variant for work in process and scrap. But it is always advisable to preliminary cost estimate in the target cost valuation strategy, because that is more accurate.
To conclude, you can always do away with creating a PCE for backflushing, but that is not what SAP suggests.
Regards,
Hasan

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MF30, Preliminary cost estimate, KKF6N

Hi,
The MF30 transactions hold up for a particular material without giving any error message. The material is having two production version maintained and there is also product cost collecter maintained. However when i execute the MF30 transaction of material, the system starts to execute but then stops without giving any error message. Also when i checked in KKF6N, no preliminary cost estimate is done for the particular material.
Please help me in this case.
Thank you.

Dear Sameer,
For the first time when you create a product cost collector for a material in KKF6N,before saving automatically it calculates the
preliminary cost estimate.
In other cases where the prod.cost collector is created goto KKF6N,enter the material,plant and then the productioon
version,now click on change mode icon and then calculator like icon for cost calculation and save the datas.
Check and revert back.
Regards
Mangalraj.S

Cost collectoru0092s preliminary cost estimate

When we executed cost collectors preliminary cost estimate using T-CODE MF30,
we found error message CK239.
The cause was low lever material's preliminary costs error.
But only low level materials preliminary cost using T-CODE MF30 was normal.
Material's price, activity price, activity qty was normal and high level material's sntandard
cost calucation using T-CODE CK11N was no error.
How can we fix the error?

HI Su,
Can you cross-check the following,
(1) All the lower level Materials have a standard cost in their accounting view
(2) Planned prices for all activities in KP26 have been maintained for the period.
Sometimes you get this error if there was an error releasing to material's standard price or a new activity has been introduced in material route but the planning for same has not been carried out.
Regards

Digits Of Significance/Rounding Issue-Cost Estimate With Quantity Structure

I have an Excel based BOM which includes Material (Yield) Qty, plus a scrap factor. This adjusted yield is then multiplied by the Unit Price to get the Extended Amount. An example from my file is:
Material 10-0766 = yield of 1.824 sq ft less 4% scrap 0.07 sq ft = adjusted yield 1.897 sq ft * 1.836 USD/sq ft = Ext. Amt of 3.483 USD.
In SAP, I created a BOM via CS01 with this material as a line item, 1.824 as the qty, UOM is FT2 (sq ft) and I added a Assembly Scrap of 4% with the Net ID indicator checked. When I create a cost estimate via CK11N (in our SAP AFS 6.0 sandbox), the itemization for this material reads: qty of 1.897, total cost of 3.48 USD.
The math all works, but the resultant USD amount in SAP is short by .003 USD. I realize that USD currency is configured to only 2 decimal places, and that is fine. But, I thought that the calculations that costing was doing was retaining all the digits of significance past the 2 decimal places being shown, rather than rounding off to 2 decimal places. There are 24 materials in this BOM, and the total delta between my Excel sheet total (17.647 USD) and my SAP estimate (17.63 USD) is 0.017 USD. If I look at each item, the cumulative difference is due to each line rounding off to 2 decimal places.
The units of measure (via tcode CUNI) are all configured to show display 3 decimal places (field DECAN) and round to 5 decimal places (field ANDEC).
Does anyone have any information/suggestions around the precision in my SAP cost estimate? Am I stuck with these differences, or is there something I can do differently to prevent them? I know I can increase digits of significance in Activity Price Calculation, but I can't find anything similar in Product Cost Planning. Any help would be greatly appreciated.

Hi
To achieve you have to run the costing run twice once normally.
Secondly you create an alternate BOM 2 by having the same alternate BOM 1 and remove the 2 materials which you dont want.
Execute the costing run, provide the details required in the Costing data screen, press enter, go to the Qty structure screen give the details of the Alternate BOM 2 in the BOM details and execute the costing run.
Save the cost estimate, which would be have been costed without the values of two materials as you wanted by using the alternate BOM 2.
Then use CK24, select the option "other prices" to release the cost estimate for the commercial price only by selecting the indicator of commercial price 3 only.
Regards,
Suraj

KKF6N - Preliminary cost estimate- BOM explosion

Dear All,
When I try to cost a product cost collector on a finished product/production version with MF30 or KKF6N, the BOM is not exploded as if all the components were raw material - despite the BOM is multilevel. I don't understand why. Maybe i miss something...
On the other hand, when I cost the same finished product with CK11N, the BOM is exploded as expected.
The settings on cost variants and valuation variants used for cost collector and material cost estimate are similar.
Thank you very much if you can help !
Chris

Hi,
                                                                                The difference between CK13N / CK11N and KKF6N exists due to the method in which both of them calculate costs.
CK11N performs 'multi level costing' which means it considers the prices and the corresponding quantity structure for materials across the entire hierarchy of the BOM for the material and re-calculates it every time it is run based on current settings.
KKF6N performs 'single level' costing which means it considers only the price data for the input material and its immediate sub-components. It then displays the price according to the valuation strategy used in the costing variant.
CK11N also uses the valuation strategy, but the price is estimated based on a calculation of prices across the entire hierarchy of the BOM for the material also factoring in the quantity structure at the time the material is costed.
This is the reason why there is a difference in the price shown in CK13N and KKF6N, but it is the way the system is designed to work.
Kind Regards,
MLM

How to find out operation unit used in preliminary cost estimate.

Please tell me in which table operation unit used in cost estimate is stored.I dont want information from routing.Can i get the information from cost estimate table itself.

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Preliminary cost estimate

Hi Experts,
We have 2 plants. I am trying to run cost estimate for a FG which exists in both the plants. I want to do the costing run later on for the same. The cost estimate and costing run ran very well without any problem in the first plant, but in the second plant it says that there is no base unit of measure maintained for conversion exists.
I checked and compared the material master for that material in both the plants. I found them to be identical. I do not understand how to make progress. Please Help!
--Sachin

Dear Sachin,
First the basic concept of maintaining the same material in more than one plant means then the same
unit of measure is to be used.
If you want to describe an alternative unit of measure means then goto additional data in the top menus
and then in one of the tab key-Units of measure---> you can maintain the relation.
Say if your base unit of measure is ea(each) and if you want to include bag as the additional unit of
measure,then while defining you can do as For Eg 1 bag = 100 ea.
So this additonal unit of measure can be defined either in Sales view or work scheduling view(unit of
issue) or Purchase view or in the additional datas.
Check what's the unit of measure that you have maintained in the costing view of the material master.
So in the problem giving plant check the material master data and correct it and then take the costing
run.
Regards
Mangalraj.S

Split valuation-Preliminary Cost estimate

Hello,
Is it possible to create a Prelimnary cost estimate for split valuated material.Relevant Proc alternaitves crtd
Pls help

Hi,
In the case of split valuation only header and not the valuation
type is costed.
If one material has split valuation, standard price will be released
only for header segment (valution type blank). You have the possibility
to release standard price for in-house production segment, if you set
the 'Default'-flag in the customizing transaction for splitted val.
(OMWC) for the val. category 'X'.
Please check the note 552486 that contains information about
this context. (Question 10).
Alternatively you might created mixed cost estimate to release prices
for each procurement alternative that is associated with an val. type.
The only way to mark and release a standard costing per valuation type
is by using the functionality of mixed costing. That means that you
have to define a quantity structure category and define a
procurement alternative based on a valuation type of your material.
Afterwards you have define a mixing ratio for your material and the
defined quantity structure category.
Based on this mastr data (procurement alternatives and mixing ratios)
it is possible to carry out a mixed costing, one part of this
mixed costing should be a cost estimate based on your valuation type.
If you mark and release the mixed cost estimate the system will
set the standard price on valuation type level (prerequisite:
you have the define the procurement alternative based on the
valuation level)
For more details please have a look in the R/3 documentation for
mixed costing or contact your consultant.
Please refer to NOTE 552486 (FAQ):
"Question 10: In the case of a split valuation, why can the prices only
be updated in the internal segment?
Answer:In the initial standard SAP System, only the header segment is
calculated and the price is updated only here.However, if the "Valuation
type 'in-house production' mandatory" flag is set for the categories in
Customizing (Transaction OMWC), it is also possible to update the price
in an internal segment.For external segments (procured externally) this
does not make any sense in general.However, mixed costings can also be created and updated for several segments via procurement alternatives."
Setting this flag will take impact on materials WITH split valuation
in the future. New prices will be released for the in-house segment
in addition to header segment in TA CK24.
Also check the online documentation related to this topic
http://help.sap.com/erp2005_ehp_03/helpdata/
EN/34/f4af26be4411d1898f0000e8214595/frameset.htm
I hope the above information is of use to you.
MLM

Backflush with Prel cost estimate still considering standard cost estimate

Hi,
Trying to do back flush with Prel cost estimate . Flagged in REM profile " Post Activities " / Using Data from Preliminary Costing".
However, FG rate is considred as per standard cost estimate and not as per preliminary cost estimate.
Kindly advise whether any other specific setting is needed.
Regards,
Mrinal

HI
check these links:
standard / preliminary cost estimate
Significance of Preliminary cost estimate,
preliminary cost estimate for product cost collector
Hope it clarifies.
Regards
Anupam Sharma

Material cost estimate with quantity structure (tcode: CK11N)

Hey dear friends.
I donu2019t know in which forum I should put my question above.
In fact, Iu2019m new to SAP PM module.
Iu2019m trying to create material cost estimate with quantity structure (tcode: CK11N) for a material u201CXu201D.
This material is manufactured.
While running the transaction CK11N, I got an error message.
After analyzing this error message, Iu2019ve realised that somebody had assigned wrong activity types to cost centers which are linked to this material in tcode: CR03, tab: costing.
So Iu2019ve changed and assigned the right activity types.
Then, Iu2019ve tried to run the tcode CK11N again. But the system still brings the wrong activity types and seems to ignore the ones that Iu2019ve assignedu2026
It seems like the old activity types still linked to the cost centers somewhere else than in tcode CR03u2026
Any idea about what am I mising ?
Thank's in advance.
Bahia.

Dear Bahia,
If its rate routing means,i guess you must be working in REM scenario.
So goto CA22,delete the existing operation and then assign the same work center in a new
operation,check what activity types is it proposing in the rate routing,if its reflecting correctly means
save the datas.
Also goto KKF6N--->click the change mode icon and then calculator button to create a preliminary cost
estimate and then save the datas.
One of our forum friend has asked you to check the production order read PP master data once
again,but understand there is no production order concept in REM scenario,only planned orders.
Then come back with your queries.
Regards
Mangalraj.S
Edited by: Mangalraj.S on Jun 17, 2009 12:05 PM

Error determing cost estimate

Hi Experts,
When i am trying to backflush planned order type PE in open period its giving following error
Error determining the cost estimate
Message no. RM078
I tried to do cost estimate in KKF6N, it doesnt show any error, and save successfully butt again when i am coming back to mfbf its throwing same error, what is the reason behind that, i am doing mfbf in march 2009 because its open period here.
Please help me in this regards.
Thanks & Regards,
Karad D D

Dear Devidas,
check what type of REM profile you have assigned to the material master.
Check the setting of the REM profile in OSP2,whether under cost accounting the check box is set for backflush using
preliminary cost estimate or else using standard cost estimate.
If it's having std cost estimate check box means,execute CK40N and then only you will be able to backflush in MFBF.
Check and revert back.
Regards
Mangalraj.S

Prelimanery cost estimate

Dear Gurus,
There is price diffrence between the valus of (Prelimanery cost estimete ) MF30 and standard cost estimate ( CK11n) for the same material. What is the reason behind that. And i am stucking on a error in prelimanery cost estimate, that after running mf30 system shows me error message "No cost field for fixed costs has been defined'
Thanks in advance
ACP

Dear ACP,
I guess you are working in a REM scenario involving product cost collector and preliminary cost
estimate.
Prelimary cost estimate is calculating the planned costs for a business objest such as orders.
Where it sums the material cost,activity cost and the overhead cost.This will not reflect anywhere in the
material master.
But a standard cost estimate which is carried out using CK11N can be marked and released by using
CK24.This will reflect in the material master.
This can be performed using CK40N also.
Check and revert back.
Regards
Mangalraj.S

Preliminary costing and Simultaneous costing

hello gurus,
can any one explain the difference between Preliminary costing and Simultaneous costing in Product cost by Period.
Regards
rihana

In product cost by period you are generally using product cost collectors. The preliminary cost estimate is the estimated cost for the product cost collector prior to manufacturing. The cost estimate is calculated when the product cost collector is saved and the estimate is based on the costing variant that is assigned. Simultaneous costing happens as a result of manufanufacturing and the confirmation process. It represents the cost of the materials, activitities, and overhead that are actually charged to the product cost collector. Typically, with product cost collectors materials and activities are backflushed. The amount of the backflush can be based on the preliminary product cost estimate or a standard cost estimate. Simultaneous costing uses a different costing variant then preliminary costing, so valuation strategies for materials, activities, and overhead can be different for both as well.
thanks,

Cost estimates

Hi: All,
Can any one Please explain the following with its applications
1) Standard Cost Estimate for material
2)Priliminary cost estimate for Product Cost COllector.
please explain them with example.
your help will be rewarded.
Cheers,
Nagesh.

Dear Nagesh,
1.Standard Cost Estimate for a material or product is made up of Materials cost,Over head cost & the activity cost(oparation cost).
Standard Cost estimate which is done using T code CK40N is for the Finished product so that it automatcially calculates the HALB
materials cost also.Product Cost = Material's Cost (Raw Materials & Semi-finished product's ) + Activity Cost (operation cost) +
Overhead cost,if an overhead group is assigned in the material master of Finished product.
For Raw-materials Planned price's are given in the material master in Costing 2 view & the price control indicator will be V.
For In-house manufactured Semi-finished & Finished products the price control indicator will be S.
Activity cost is calculated as per the operation time maintained in Routing or Rate routing(A Cost center & activity type will be
assigned to the work center and a rate should be existing for that activity type & cost center combination in KP26).
Once after standard cost estimate is completed the calculated cost is printed in the material master for FERT & HALB products.
This is carried out using t code CK40N.
2.Preliminary Cost estimate is carried out using T code KKF6N for Inhouse manufactured HALB & FERT's which comes under REM
scenario.Its only a cost calculation but this value does not gets updated in the material master.
3.SO in REM scenario as per the setting in control data 1 for cost accouting post activities it can be using standard cost estimate or
else using data from pre.cost estimate for product cost collector confirmation can be carried out that's MFBF can be carried out.
I hope this will clear your doubts.
Regards
Mangalraj.S

Eroor detrmining the cost estimate

Dear all
the standard price has already been released for a product
but in MFBf it gives error detrmining the cost estimate

We no longer use REM, but my thought is that each order, when created, calculaes a preliminary cost estimate, for the order base on the current BOM and Routing. You get errors in the cost of orders when "something" has changed since the release of the cost estimate and would cause an error if costed "now".
1 - a change has been made to a BOM or Routing or MAterial, and if you ran CK11n now, you will get an error.
2 - the materials and activities of the order were changed and are causing the error.
Go to the order, open it up and click on a button or menu that says: calculate costs. a meessage log should result and tell you what the problem is

Significance of Preliminary cost estimate,

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