To compute direct or overhead cost

hi,
For allocation like distribution and assessment cycle, it is to allocate the overhead cost
May I know KB21N which is to transfer cost from 1 cost object to another using activity type, also to calculate overhead cost or is it to calculate direct cost?
thanks

novocar,
Normally it is for actual overhead allocation (or you called calculation). Actual direct cost is normally allocated by confirmation on production orders.

Similar Messages

  • Overhead cost

    Dear All,
    We have manufacturing set up,where in the client produces  diffrent kind of mother boards (FG materails ) in a Single Line :(i,e created as a one Production Cost center) .We have four activity types through which direct cost will be captured for each activity type for each FG material.
    Apart from the above,we have Facoty Overhead,Manfacturing Overhead,Admin Overhead & Other Overhead Cost.
    One way to bring this overhead cost to production cost ihat first allocate this overhead cost to Production cost center,then splitting of thse overhead cost among four activity types and finally arriviring at the actvity cost per hour ,which includes
    both the Direct Cost & Overhead Cost.
    But my client is not acepting this approach of aplitting and taking as part of activity cost.
    Client wants to allocate the  Overhead cost to different FG materials based on the no.of mother boards produced as overhead cost needs to be captured separately for each mother board production cost.
    Can any body throws some light on how to bring the overhead cpst as part of product cost (inventory cost),instead of splitting the overhead cost to activity types.
    Regards
    Su

    Dear Ajay,
    Dear Mr Ajay,
    I have explored the costing sheet concept and worked on this,but when I was estimating cost by CK11N,I could able to see Overhead Cost in the Cost Component View,but when I select Itemisation view,Overhead costs are not appearing.
    Please tell me what could be the reson for this .Am I missed any thing.
    One more concern I have that l when I estimate the cost by KKPAN,there is no item category for bringing the Overhead Cost.
    As you know that Category 'M' will be used for Material   ,Category 'E' will be used for Actvity Cost,similarly what item category to be used to bring the Overhead Cost.
    Please suggest.
    Regards
    Su

  • Dividing the overhead costs to production orders !

    Hi all,
    This is regarding the overhead costs split to different Production orders.
    The scenario is for e.g There are 3 production orders
    P-1
    P-2
    P-3
    and the first 2 production orders(P-1 and P-2 ) are assigned profit center 1
    and the last production order (P-3 )is assigned a profit center 2.
    In the costing sheet configuration the profit centers are defined and profit center 1 is assigned 10% and the profit center 2 is assigned 20%
    The overheads/ other direct costs should be split into 3 pdn orders in the % assigned to the profit centers.
    Is this possible? if so, let me know the methodology.
    Thanks and Regards
    Karpagam

    absolutelly possible
    if you have defined the % per PC in KZS2 and there are costs on the orders (as the basis for %)
    than you have to run KGI2 or CO43 (mass)
    cheers
    matej

  • Actual Overhead Cost Splitting

    Dear All,
    We have 5 direct activity types and  3 overhead activity types in the system.
    Plan Overhead  cost splitted perfectly  aginst the 5 direct activity types based on the activity quantity,
    but when it comes to actual splitting:
    1.the system splitting the cost eually in NEGATIVE  among the 5 direct activity types instaed of splitting to 3 overhead activity types
    2. system considering the all direct activity cost as part of one overhead activity types.
    I am unable to understand how the system is behaving while splitting actual overhead costs to direct activity types
    Can sombody throw any light on this issue.
    Regards
    SU

    Dear Mr Ajay,
    Can you please help me on this issue.
    Regards
    Su

  • SOS for CO - Overhead Cost Controlling (COOM)

    Dear FICO GURU,
    I am PP/PM Consultant , Would request some knowledge sharing about CO.
    Understand in standard SAP Overhead Cost Controlling consist of 3 component following :
    o        Cost Center Accounting
    o        Internal Orders
    o        Activity based costing
    Overhead costs are defined as costs that cannot be assigned directly to cost objects.
    My Question :
    In one Plant , can we use all the above ? Or we can only use either one ?
    Understand there is cost apportionment in CO , If we using Overhead cost controlling , can we still use this function ?
    Is cost Apportionment only applicable for CO Product in Production Planning ? What's the prerequisite ?
    Thank you.

    Yes, sure you can. However it would be a long story to convince you. But first I revert the question:
    Can we use different material groups in one company code?
    The above mentioned 3 areas generally doing the same but with different functionalities but the story is the same:
    Storing and sending costs from one place to another, sometimes grouping them sometimes transforming them.
    Cheers
    M

  • Kb21n overhead cost

    Hi,
    For allocation like distribution and assessment cycle, it is to allocate the overhead cost
    May I know KB21N which is to transfer cost from 1 cost object to another using activity type, also to calculate overhead cost or is it to calculate direct labour cost?
    thanks

    Hi
    Yes, KB21N is to charge overhead.. Ends are the same, but means are different...
    Kb21N is when you forget to add an operation in the routing and hence the Labor hrs did not get charged to Prod order.... Or you confirmed more by mistake and you want to rectify that...
    In such cases KB21N is used which charges Labor hrs and there by the cost to the receiver object
    br, Ajay M

  • Maintenance Overhead Costs

    Hi All,
    I have a requirement:
    In Maintenance Order, labor cost & material cost are being captured. Apart from direct labors, there are managers for the maintenance dept or other indirect persons. How those costs can be calculated or distributed over the orders.
    Also please let me know, whether is it business practice. As maintenance order should carry only the Actual Costs incurred for the Maintenance. Only in production, overhead costs will be calculated to finalise the Sale price of the product.
    Please give your suggestions.
    Regards,
    Maheswaran.

    Hi,
    Your question is perfectly valid. Not only Manager charges, there are other utilities you will be using like power, small qty of lub oils and cotton waste for example. You can have overheads calculated based on you planned cost of maintenance order. It's a integration poing of FI-CO and PM. Through costing sheet assignment you can bring over head key in to the picture. I heared that the over heads also calculated in terms of percentage of total cost.
    Regards,
    N.Nagaraju

  • Difference Aetween Overhead Cost and Product Cost

    Sir,
    What is the difference between Overhead Cost and Product Cost
    Thanking You
    Juhi

    Product cost indicates the cost of making a product which includes
    1) materials (contained in the BOM)
    2) labour  (specified in the routing)
    3) Overheads (charged via costing sheet).
    1) and 2) are directly identifiable to the product made.
    3) is not possible to directly associate to a making of product. This is more a common cost. Eg. Material handling charges. The material handling department, say, employs a few workers to do material transfer from warehouse, their cost is hard to associate to a particular production order.  Hence, usually a percentage is applied , where in the order is charged proportionate to use of materials in that order. The corresponding credit is given to the Material handling departmnet/cost center.

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  • Cost estimate (CK11N)is not picking the overhead cost for some of the mat

    Hi all,
    we are facing a problem. The overhead key is defined. the calculation base is defined in the cost sheet. But the overhead cost is not picking  for some of the materials
    Bad Material 5019-0581 via CK11n.
    As you can see in the itemization, only the material and the routing are listed.  No amounts from the OH of ZPTA ( .10).  It should show a line #5 with an amount of (28 quantity  x .10) = $2.80 added to the Total value.
    first three line items it is picked from material and fourth line item from the internal activity.
    the fifth item from G overhead is not picked.

    Hi,
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    Regards
    SudhakarReddy

  • T-code to confirm the Overhead cost  ?

    Hi
    Can any one let me the T-code to confirm the Overhead cost in a plant maintenance order.
    I have some overheads under plan cost. How can i bring the Plan cost to Actual cost for overheads.
    venkat

    hi
    on what basis the overheads are calculated
    say 100 $ is actual cost in order what is the overhead on order
    what is the formulae to be used & set this formulae
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  • Overhead Cost in Process Order

    Hi All
    I need your expert inputs  / suggestions to apply the correct method of calculating overheads in process order.
    Requirement:
    To calculate
    a. Labor cost
    b. Overhead Cost
    c. Depreciation Cost of Machine
    in a process order. Also .b. and .c. are dependent on labor time entered (a.)
    What I have done:
    I am new to PP and CO, so with my limited understanding I have done the following:
    1. Created activities for labor, overhead cost and depreciation.
    2. Created secondary cost elements
    3. Created Standard Value Key
    4. Added all the parameters (Labor, OVH, DEP)
    5. Created a formula for these parameters
    6. And used them in Resource and KP26
    Problem:
    With the above setup I get three values (Labor, OVH, Dep) to enter in the process order confirmation. However I need just one field : Labor time, for all the values to be calculated.
    As OVH and Dep should use the same time as for Labor parameter but with different rate (as mentioned in KP26) is there a way out where I can just show Labor variable to be entered to the user and other two use that time also!
    Or if you feel there can be different approach for the overheads and depreciation to be calculated kindly write back
    Thanks in advance
    -Rahul

    Hi rahul
    I understand you want to use same formula for cossting for the
    a. Labor cost
    b. Overhead Cost
    c. Depreciation Cost of Machine
    Then in work center->  costing tab you can mention same formula for the overhad and Depreciation which was using for  labour cost.
    Please check and come back.
    Regards,
    srihari.M

  • How to exclude the overhead cost from DIP source data

    Hi :
    I'm using EK01 condition to catch all the cost booked against  the project object from PS, when I try DP91 to have DMR, it's return error "material determination error".. that's caused by overhead cost element is not configred in ODP1.
    Actually, we're not expecting overhead to be billed to customer,, how we can config to get this resolved ?
    Thanks !

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    I'm using EK01 condition to catch all the cost booked against  the project object from PS, when I try DP91 to have DMR, it's return error "material determination error".. that's caused by overhead cost element is not configred in ODP1.
    Actually, we're not expecting overhead to be billed to customer,, how we can config to get this resolved ?
    Thanks !

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  • Overhead costs

    Dear friends,
         I need your input to capture overhead costs involved while executing production order.
    While preparing for product costing, it includes material cost and internal activity costs(means secondary cost elements).
    But i wants to capture overhead costs involved for a particular production order.
    For example, over head cost related to production is Shop floor cleaning. This process has been subcontarcted. We are paying for this in monthly basis.
    For your information i have created secondary cost element (t.code:ka06) for overheads .
    But my problem is how to link this overhead costs with a particular  production order?
    And how to capture paying terms(Monthly basis) of this overhead costs?
    Please guide me?
    Senthil

    Dear suraj,
       I have created secondary cost element (T.code:ka06) as Z_overhead with cost element category as 41 and attribute mix as FP and assigned to my cost center.
    Then i was about to create activity in t.code KL01 as O_HEAD. Here only i got problem.
    If you get into this t.code(kl01), in "Allocation cost element category" field i should able to assign the secondary cost element what i have created in t.code KA06, ( here it is z_overhead). But i can not assign the same secondary cost element with the activity.
    So i can not successfully create my activity type.
    Please guide how to create secondary cost element and activity type for over head.
    Please explain me in detail
    Waiting for your response
    Thanks
    Senthil

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