Standard and Moving Average Price in Material Master

Hello,
Can any one please tell the basic difference between Standard and Moving Average price? both the cases how the Material Price is calculated?
And please provide the accounting entry's also.
Thanks

Dear S McIntosh,
You may check URL below that explain the difference between MAP and Standard price.
http://help.sap.com/saphelp_47x200/helpdata/EN/47/60ff0749f011d1894c0000e829fbbd/frameset.htm
Regards,
ian Wong

Similar Messages

Standard and Moving average Price

Hi,
What is the Difference between Standard and Moving Avg Price, What are the Cases will we use Standard Price ,and what are cases shall we use Mov.avg Price, Please Explain me with Example.

Hi Lakshmi,
Moving average price is maintained for all the outside procured materials and standard price is maintained for all inhouse manufactured materials...
We need to run standard cost estimate monthly to update the prices of all the materials with price control S... Prices of materials with price control V will get updated as soon as we do GRN for the materials on the weighted average method...
Regards
Raj

Moving average price in material master

Dear All,
M client is in manufacturing process(variant configuration) having make to order scenario (Non-Valuated).
We are having steel and ring business, For Steel business we are producing in house/subcontracting and For Ring we are sending Raw material/Semi-finished goods to Sub-contractor for which he is charging processing charges. Raw material/SFG(semi-finished goods) provided to subcontractor is SFG for steel business.
We are doing movement type 912 E for sending goods for subcontracting (sales order is attached) and while doing G/R through MIGO processing charges are debited and credit goes to gr/ir account,Upto this point I am ok with costing as visible from sales order analysis(KKAC).
Now In our scenario if out of 6000 rings (as defined in sales order)customer is rejecting 1000 rings we have to detach that sales order through movement type 411 E and bring to our own stock or by movement type 412 E attach to another sales order .Also We are using 413 E movement type for transferring unsold goods to another sales order.
In 411 E and 412 E movement types system takes moving average price (maintained originally ) and by using movement type 413 E no value is transferred only quantity is transferred (because of non-valuated scenario).
Now if system picks original price maintained say at re.1 my costing for detached and attached sales order are incorrect .
Example
Material master(A) accounting view
Map     1
Stock     100               total value     100
Sales order 1(10 tonnes)A (finished product)
Cost     1000
Revenue     800(5 tonnes)
sales order 2
cost b/f          5
Revenue        800(5 tonnes)
Now if 5 tonnes are detached from sales order it picks price from
Master i.e Re.1 so Rs.5 is taken to own stock through mtype 411 E
Or it takes Rs.5 to another sales order 2 as cost of 5 tonnes .
Now my sales order 1 will show loss of Rs.195(995-800) and sales order2 shows profit of Rs.795.
I want to know whether system is behaving correctly or some customization is to be done.
Thanks and Regards
Vijay
Edited by: VIJAY MATLANI on Oct 13, 2008 5:28 AM
Edited by: VIJAY MATLANI on Oct 13, 2008 5:30 AM

Hey
Check have you made any purchasing documents, with reference to material.
And anybody played MR21 for the particular material?
Thanks
Raman

Costing with Standard and Moving Average Price

Hello All,
I understand that SAP recommends Std Price for Semi Finished /Finished goods and MAP for trading goods and raw materials.
How does costing takeplace when it includes both the materials - semi finished and trading goods.
Is it possible at all?
Any suggestions will be helpful.
Thank You,
Andy

Hiya,
You may want to frame your question differently.
When what(?) contains SF and Trading Goods? BOM? Costing Run?
The Std Price and MAP you mentioned are the Price Control Indicators. These dictate the price to use and the treatment required for the material (realtime stock value updation during the month with GR/GI for MAP and no value updates for SP).
By itself, it does not affect the costing of (say) a BOM containing both these materials together... the system determines what price to use and costs the product accordingly.
Cheers.

Standard vs Moving Average Price

Dear SAP Gurus
Can anybody pls explain the significance of Moving avg and Standard price of Material.
Thanks & Regards
Shalini

The standard price or moving average price in material master is used to determine the value of the inventory.
Standard price are used for products that do not fluctuate frequently. It is mainly used for FG or semi finished products.
Moving average price are used mainly for raw materials that are purchased externally. The advantage of using moving average price for raw materials is that the inventory costs will always reflect the current market price.
If the material is valued at a standard price,
the difference between the purchase order price and the standard price will go to a price difference account.
If the material is valued at a moving average price, the difference between the purchase order price and
the moving average price will NOT go to a price difference account. The moving average price will simply be adjusted.

MIRO : Moving average price for material is negative

Hi,
i post an invoice but the system gives me this message : "Moving average price for material is negative: 120462 M411"
i tried to change the average price (MR21) but really it is not a solution.
is there any other solution to post this invoice?
Regards
Edited by: jehade el aoumari on Oct 22, 2008 2:06 PM

Moving average price negative error comes when the correction in price of material made in MIRO is more than its moving average price in material master. There are three ways to solve this error,
MR21 as you said, or
Reverse all previous transactions like GR in the sequence they were made, amend the PO and make fresh GR. or if this is not possible,
Complete the MIRO with wrong amounts and pass FI jv to rectify the wrong FI impact....
Hope this helps you..

Difference between Standard Pricing and Moving Average Price

Hi,
Would like to seek some advises on the difference between standard price and Moving average price.
also, how does it affect the account postings differently?
Thanks

Standard Price
Materials whose price control indicator is set to S are valuated in Financial Accounting (FI) at standard price.
This is recommended for semifinished products and finished products.
The moving average price is shown as a statistical value in the material master record.
The standard price is normally calculated using a standard cost estimate for the material. The standard price can also be calculated in a mixed cost estimate.
Moving Average Price
When materials whose price control indicator is set to V are received from in-house manufacturing processes, they are initially valuated with a value you defined (such as the standard price). When you settle, the material stock account is debited with the variances. This results in a new moving average price.
Valuating semifinished products and finished products with the moving average price is not recommended.
Regards,
Indranil

Stock of material and moving average price for each valuation type

Hi
Is anybody aware of any standard report which will show the stock of material and moving average price of the material for each valuation type.
M5BL is one report but would like to check if there is any other report.
Regards
Vaibhav Mahajan

Hi,
Check MB52, select 'Display batch stock' option.
Batch is nothing but your valuation type.
You can see those details there.
Regards,
Piyush

-ve price change in Moving average Price of Material in Material Master.

Dear All,
Kindly guide on below issue.
We have a Material e.g A which stock was available in System let us say 10 qty & the Price per unit was Rs.10. But in last August some users chagned the price to Rs.5 because of whcih the Valuation in previous period has become negative.
Now I have to rectify this. Now please tell me how can I do so.
Also Note: there are sevral other Movements have happened since then i.e. GR, IR, Consumption for Production etc.
This is very important.
Regards,

For negative MAP , there are steps which are given in SAP note 356757. Follow this steps to overcome this issue.
The notes goes as...
Summary
Symptom
When you try to post an invoice for the purchase order, the system generates error message M8783: 'Moving average price for material & & & is negative'.
Additional key words
MRHR, MR1M, MIRO, MMVAL, M8783
Cause and prerequisites
You posted a valuated goods receipt for a purchasing document for a material with moving average price control.When the invoice was posted (invoice item with price variance for goods receipt), the system generates error message M8783: 'Moving average price for material & & & is negative'.
Between the posting of the original goods receipt and the entry of the invoice, the system already posted additional valuation-relevant transactions/events (goods movements, invoices and so on, can be displayed with Transaction MR51).
The invoice verification tries (for stock coverage) to credit/subsequently debit the difference between the value of goods received and invoice item value for the stock.However, the material total value must not become negative by this stock posting.
Solution
Before you post the invoice, you must first increase the stock value.
The amount by which the stock value must be increased at least can be calculated from the following values:
1. Transaction MM03, accounting view material master, field 'Total value' (MBEW-SALK3)
2. Invoice item value according to invoice
3. In the invoice verification (Transaction MR01, MR1M, MIRO), change the invoice item amount to a value which is high enough and simulate the invoice to receive the value which would be posted for this item to the GR/IR account.
In the invoice verification, the value (3) minus (2) is posted to stock. It must be larger than (1).Post a subsequent debit with the amount (3) + (1) - (2) for the affected material/plant (Transaction MR22).
You can post the invoice afterwards.

Changing of Inventory Valuation: Standard to Moving Average Price

I work at a service-based company and have also been asked to research the impact involved with switching our inventory from standard price to moving average price.
Scenario: Change material type TRAD (trading goods) from standard price to MAP.
Process: Change settings in SPRO at the level of u201CDefine Attributes of Material Typesu201D. Currently, this is set for u201CStandard priceu201D with the indicator u201CPrice ctrl mandatoryu201D set. Upon change to u201CMoving average price/periodic unit priceu201D, Iu2019m thinking I need to de-activate the u201CPrice ctrl mandatoryu201D field so any current materials with an u201CSu201D in the Price control field on the Material Master Accounting 1 tab can be changed to u201CVu201D. Is this correct? Also, is there a program that already exists to mass update the Price control field on the Material Master? If not, I was looking to create a CATT for this changeu2026.any other ideas? In some of the forum posts it was mentioned to use t-code MR21 however, even with the u201CPrice ctrl mandatoryu201D field de-activated, the Price control column is grayed out.
It was mentioned in a previous post that all open documents (PO to IR) need to be completed before changing the price control setting, at what point does this stop the process? Does SAP generate a system error message?
Also, any suggestions as to when this price switch is best to take place like after inventory?
Are the above mentioned areas the only areas I should be concerned about or am I missing some areas that should be addressed?
P.S. We do not use have our ML (material ledger) activated or use split valuation.
Thanks~
Dawn

Hi,
If you want to change material from standard to moving average price, Follow the below process
1)first the material quantity and value should be zero
2)if you want to keep value and quantity and want to change price control in future you have to create new material with price control "V' and lock the previous material for posting.
Regards,
Sreekanth

Standarad price and moving average price

What is the diff between Standarad price and moving average price ???
Somasundaram

Price Control V or S in material type
When is it useful to use the price control V or S in Material Master ?
Do I have to follow the SAP standard setting in the material type for the following material types:
- ROH(Raw materials) -> moving average price
- HALB(Semifinished products) -> standard price
- FERT(Finished products) -> standard price
In which case and why is useful to change these standard setting in material type?
What is difference between standard price and moving average price?
When and how to use it?
Standard price are used for products that do not fluctuated frequently. It is usually used for finished or semi finished products.
Moving average price are used mainly for raw materials that are purchased externally. The advantage of using moving average price for your raw materials is that your inventory costs will always reflect the current market cost.
SAP strongly recommends that you do not select price control V for semi-finished products and finished products, because doing so will very easily cause the calculation of unrealistic valuation prices. SAP recommends:
Price control V for raw materials and trading goods; price control S for semi-finished products and products.
If you nevertheless select price control V, take care in the following situations:
1. Unrealistic prices occur if materials are produced and also retire during one period (that is, the inventory at the end of the period is smaller than the total of aquisitions from production orders) and if, in addition, several production orders belonging to a material were finished in this period, and the production order settlement calculates variances at the end of the period. Every single production order carries out an inventory coverage check and may therefore cause the moving average price to be changed. However, the individual production orders do not check whether the inventory available at the end of the period has already been debited by another production order.
Example: on 20 workdays in the period, 1 piece of material xyz was produced for each day and delivered to the warehouse at a price of USD 1000. At the end of the period there is 1 piece at the warehouse. Since an activity price of a participating cost center was higher than planned , every single production order calculates cost of goods manufactured of USD 1100 during the settlement. Every single one carries out a inventory coverage check and finds out that the variance can be posted completely to the inventory. That is, the ending inventory of one piece is debited with USD 20 x 100 and it consequently receives a price of USD 3000.
1. A settlement is carried out although not all costs have yet been posted to the order. This can even result in a price of 0 for the delivered product.
2. No period check of the costs is carried out on the order, that is, costs from previous periods may be settled.
3. Settling orders is already possible in the 'Delivery completed' status.
Solution: Standard price for products together with possible manual price changes.
If you are required to valuate semi-finished and finished products with actual prices that correspond to the costs of the actual production, SAP recommends you use the function of the material ledger for this. Here, a periodic actual price is created that is calculated on a much more reliable basis than the moving average price. A so-called price limiter quantity is used which makes sure that in the above example price differences are proportionally taken into account (95% of the total price differences) when valuating the 19 pieces withdrawn from material xyz which results in a periodic actual price of 1100 USD. In addition, it is possible as of Release 4.5 to even take into account the variances of the actual prices of the raw materials in the valuation of the semi-finished and finished products that are manufactured from it.
If we select std price for any type of material or mav and then make po, it will pick from material master or what?
The Purchase Info Record have the FIRST priority. When no po info record is found, the Purchase Order will pick the user LAST enter price. The PO module do not pick up any price from material master.
Regards,
Ashok

Greying out movin average price in material master

Greying out movin average price in material master. please explain how to do it. I know it can be done in spro / Logistics general / field selection / Maintain Field Selection for Data Screens. please elabrate

Hi,
Field name for Moving average price is VERPR and the field selection group is 37.
In the path - spro / Logistics general / field selection / Maintain Field Selection for Data Screens--> give the field selection grp as 37 and make the field as Display for the particular Field reference (Eg ROH - for material Type ROH). Save your entries.
When you create material for material type ROH, you will have MAP field as display mode.
Raj

'Moving average price for material is negative' calculation

Hi Gurus,
I would like to ask for your assistance regarding Invoice having error of 'moving average price for material is negative'.
How is it being calculated that it goes to negative value? Can you also please give a scenario on why it became negative?
We have the following scenario:
MAP: 0.30
Total Stock: 9
Total Value: 2.74
PO raised and GR was done:
Quantity: 240
Value: 2.95
Would appreciate your assistance on issue.
Thank you.
Jih

Hi,
Please check that price of that material is increased or decreased by using transction MR21. after GRN.
You posted a valuated goods receipt for a purchasing document for a material with moving average price control.When the invoice was posted (invoice item with price variance for goods receipt), the system generates error message M8783: 'Moving average price for material & & & is negative'.
Between the posting of the original goods receipt and the entry of the invoice, the system already posted additional valuation-relevant transactions/events (goods movements, invoices and so on, can be displayed with Transaction MR51).
The invoice verification tries (for stock coverage) to credit/subsequently debit the difference between the value of goods received and invoice item value for the stock.However, the material total value must not become negative by this stock posting.
Solution
Before you post the invoice, you must first increase the stock value.
The amount by which the stock value must be increased at least can be calculated from the following values:
1. Transaction MM03, accounting view material master, field 'Total value' (MBEW-SALK3)
2. Invoice item value according to invoice
3. In the invoice verification (Transaction MR01, MR1M, MIRO), change the invoice item amount to a value which is high enough and simulate the invoice to receive the value which would be posted for this item to the GR/IR account.
In the invoice verification, the value (3) minus (2) is posted to stock. It must be larger than (1).Post a subsequent debit with the amount (3) + (1) - (2) for the affected material/plant (Transaction MR22).
You can post the invoice afterwards.
Regards.
Edited by: Sachin on Sep 24, 2009 9:11 AM
Edited by: Sachin on Sep 24, 2009 9:13 AM

Moving average Price for Material is Negative

HI Friends,
I am doing MIRO for PO where its giving me error while posting the Invoice that
Moving average price for material is negative
Can any please help me to resolve this.
what would be the implications if the price difference is too high b/w MAP in Invoice .
Thnaks
Purna Nalluri

It is ofcourse bcoz there is price difference in the between PO and IR....
so as per the calculations the MAP becomes negative....
The formula for it is :
Difference/Current stock holding + current moving average...
Pls check you price entered at PO and IR....
There are no any implecations...excepts the price differece is reflected in the MAP of MMR....
hope it helps...
Regards
Priyanka.P
Edited by: Priyanka Paltanwale on Sep 23, 2008 7:28 AM

Moving average price of material is negative - MIRO

Hi,
We are trying to create an invoice using MIRO and we get this error"Moving average price for material is negative..."
Could you please provide some inputs as to why this might be happening and how to resolve this.
Please do not suggest that we change the moving average on the material.
Thanks,
Venkat

Hi,
The answer is to change the moving average!!
Calculate your new price as -
Difference/Current stock holding(/1000) + current moving average
Regards
Phil

Standard and Moving Average Price in Material Master

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