When it is update target cost in product costing ?

What is standard cost ? when it is update target cost cost in product costing ?

hi
target cost normally update when you calculate variance. Target cost is the plan cost on actual quantities confirmed
u can check the following threads
Target Cost Update in Production Order
Target cost update on Production Order
Target Cost in Production Orders
You will get to know more about target costs
krishna

Similar Messages

Updating Target cost: Production Order

Hi All,
My compnay is using V as a price indicator on all the materials including Semi-Fin and Finished and expecting to update the target cost by the Moving average price instead of Standard or planned price stored in the material master when confirming a prodcution order. The costing variant used by production order is standard PPP! and PPP2.
Any one can help me on this.
Thanks
MKR

Hi
I'm sure you know this but just to say, V-price control for semi finished/finshed is not recommended.
As to the issue in transaction OKV6 these settings control what values are used to update the target costs.
In the detail display you can see the 3 options;
(1) Plan/Preliminary Cost Estimate
(2) Alternative Material Cost Est
(3) Current Std Cost Est.
The last being the normal default.
Regards, Elaine

0315 infotype error when we are updating the cost center

Hi Experts
for one employee when i am going to change the cost center in 0315 infotype it is giving the error like
cost center does not exist in CSKS . but i checke in CSKS table it is availble in CSKS
but i noticed one point in this t-code for last costcenter , controlling area is not availble.
is this the cause for error.
Plz advise.
Thanks

Hi,
If you are checking the cost center by querying on CSKS table, The cost center should be of length 10.
You need to append Zeros to the cost center in the front to make the length as 10 and pass it to CSKS table.
Use the FM CONVERSION_EXIT_ALPHA_INPUT to input zeros in the front.
Thanks,
Sowmya

Target costs on Product cost collectors

Hi,
we have a problem with target costs on product cost collector.
For the product cost collectors which are existing from long time, it is not updating target costs as soon as backflushing(Goods issue and goods receipt at same time) is done.
For the product cost collectors which are created newly it is updating target costs as soon as backflushing is done.
so we would like to know exactly at what point of time target costs will be updated on product cost collector.
Thanks,
Santosh Malisetti.

Hi Rich,
After researching little bit we found that its a standard functionality for product collector's not to update target costs until we do the variance caluculation. But there is one special case. When a new product collector is created it will update the target costs when backflushing(GI and GR ) is done, but this will happen during first month only. once this product cost collector has participated in variance calculation process, it will not update the target costs when backflushing is done,
until it participates in variance calculation again.
Thanks,
Santosh

Target cost Not updated in Production order

Dear All,
when I save & release the production order system is not showing tgt cost. But once GR thas been done it is showing target Cost.
How can system should will show target cost without doing GR.

Dear Sainath,
It is the standard behaviour of SAP,that only making a GR for a production order you will be able to see the target cost in CO03 -
-->Goto >Cost-> Analysis.
IF the order is only created or released you will be able to see the data under cost --->itemization or else cost component
structure.
Under Analysis you will not be able to see any data.you can see the data's after making GR.I dont think some option to make the
data's visible before this.
Correct me if I'm wrong.
Regards
Mangalraj.S

Target costs not updated timely when order TECO'd

In June 27 I displayed process order xxx in COR3 - Cost analysis report with the status of TECO but the column Total target Cost has no values. In June 29, I again displayed the same but already find an entry in the Total Target Costs. Please advise why there was a delay in populating the target costs.

Hi vijay,
Is it normal that the variance calculation will take 2 days to finish the activity? Will you please specify what activity you mean as well.
Thank you so much.

GR Cost not updating as Target Cost for process orders

Dear SAPians,
We are facing an issue in Target Vs Actual cost reporting for process orders. We are creating a process order after cost estimate of that material and doing the confirmations for activity cost. After that, GR has been done for the finished goods of that process order. That GR entry is updating the Actuals values but not updating the Target cost. When I am checking the standard report KKBC_ORD, I am getting the following figures.
Cost Elemnt Text     |     Target Cost     |     Actual Cost     |     Target Vs Act
Inventory Chnge FG     |     0     |     1,472,205.60-     |     1,472,205.60-
Packing Matrl Cons.     |     1,148,142.37     |     1,252,752.68     |     104,610.31
Raw Material Cons.     |     60,463.91     |     50,688.29     |     224.38
Semi-Fin Matrl Cns.     |     181,934.68     |     367,959.56     |     186,024.88
Labour Cost Activity     |     39,735.36     |     39,862.80     |     127.44
Machine Cst Activty     |     41,611.75     |     43,153.01     |     1,541.26
That 'Inventory Change FG' entry is showing the GR posting updating actuals and not target cost. This is causing huge difference in target vs actual cost that will affect the profit and loss figures ultimately.
What am I missing here? What should I do to update the GR amount in Target cost as well.
Shirazi

Dear,
Target Cost on Production Order or Process Order is shown only when Variance is Calculated.
So please calculate the Variance, system will show the Total Target Cost.
Br,Vivek

Target cost and actual cost not picking in production order

Hello,
The target cost and actual cost is not updating in production order when I display it in CO03 in cost analysis.
Even though we have maintained planned price in KP26.
Please suggest how it can be populated.
Best Regards,
Tapan

Hi Tapan
For Target cost
1. Your std cost must be released before Goods Receipt
2. There must be goods receipt posted on the prod order
3. You must calculate variances in KKS1/2
For Actual Cost
1. Post Goods receipt and Goods issues
2. See if any mat movements are pending in COGI
3. Ensure that operation is confirmed in PP and no entry is lying in COFC
Regards
Ajay M

Target costs for product cost collector

hi,
can anyone tell me when are the target costs updated for product cost collector. it is after we post actual costs or after we calculate variance.
Thanks

Hi Elaine,
Thankyou very much for the Information. In our case when we create new product cost collector and cost it and post actual costs to it, system is showing target costs on the product cost collector even before variance calculation but for product cost collectors which are existing from long time system is not showing target costs after we post actual costs. we have created new cost component structure recently and its active from april 1. does this have any impact on the target costs. Please let me know if you have any idea on this.
Thanks,

Target cost for co-products which can be substitute

Hi,
Is there somebody who is working with co-products which can be different each time you consume raw material?
Here is the situation when we want to analyse variance Actual vs Preliminary cost.
We use Production Order with Co-Products.
When we create a Plan Order, the order costs and qty are calculated for the order header.
Actual costs and qty are charged to the order header as they are incurred.
PLAN:
Main co-product   900 PC
Co-Product A         50 PC
Co-Product B         50 PC
                           1,000 PC
Consumption:
Raw material         250 PC
ACTUAL:
Main co-product    800 PC
Co-Product A        100 PC
Co-Product B        100 PC
                           1,000 PC
Consumption:
Raw material         260 PC
An apportionment structure is used to apportion the costs and qty to the primary products and co-products.
PLAN
                                                          Raw Material
Main Co-Product   90% * 250 PC = 225   PC
Co-Product A          5% * 250 PC =   12.5 PC
Co-Product B          5% * 205 PC = 12.5 PC
                                                            250 PC
ACTUAL
                                                          Raw Material
Main Co-Product   80% * 260 PC =   208   PC
Co-Product A         10% * 260 PC =    26   PC
Co-Product B         10% * 260 PC =   26   PC
                                                            260 PC
Variance calculation and settlement are then performed at the level of the order item, not at the header level of the order.
Here is the target qty calculation made by the system.
Main Co-Product 250 PC * 800/900 * 80% = 177.78 PC
Co-Product A        250 PC * 100/ 50 * 10% =    50.00 PC
Co-Product B        250 PC * 100/ 50 * 10% =    50.00 PC
                                                                           277.78 PC of raw material
Since variance calculation is performed at the order item level, that means you can not substitute one Co-Product by another one.
In our business, we can substitute Co-Product by another one. In this example we planned to make a total of 1,000 PC finished products and we produced a total of 1,000 PC finished products. So the target quantity for the consumption of raw material should be 250 PC, not 277.78 PC as calculated by the system.
Any idea?
Regards,

Hello Ajay,
I think i am missing some thing here. For Configurable product or VC materials there is no standard cost. Costing tab 2 standard cost is zero.
When a make to order sales order is created with this VC materials, based on system settings and quantities system picks up the correct BOM and routings. Through costing funtionality with in sales order , the sales order need to be costed and marked.
This sales order cost is used for valuation of material movements including 101 from corresponding productuon order and 601 for delivery.
As far as i know for VC material target cost has nothing to do with Standard cost, because there is no standard cost at all for the material.
Please clarifty
thanks
sapfreek

Debit and Credit notes not to update COPA cost of sales when doing price ad

Hi Experts,
Please help me to fix the below issue.
When we correct price adjustments on customer accounts we use debit and credit notes to do these price corrections. We first process a ZCR order type with reference to the original invoice to reverse the transaction and then we process a debit meme request ZDR with the correct details to invoice the customer correctly.
These credit and Debit memo request are purley for pricing problems and do not effect cost of sales. Currently these Debit and credit memos are updating the cost of Sales value field (COS on Market Price - VV013) .
This creates a problem since the credit and debit memo happen in subsequent months e.g. The credit memo is reversed at the old cost of sales value since SAP keeps a reference to the cost of sales at that time but the debit memo creates the cost sales at the new standard cost which is obviously not the same as the original cost of sales. We therefore sit with differences which will not equal FI since FI cost of sales was updated with the goods issue price in the month that the goods issue happened.
We therefore need to zerorise the following value fields when doing ZDR dedit memo and billing type ZL2 and ZCR credit memo billing type ZG2.
Gross Weight in KG VV004
Invoiced Qty KG net VV002
Invoiced Qty in L VV001
Invoiced Qty in L15 VV003
Invoiced Quantity VV005
COS on Market Price VV013
VV001 to VV005 are quantity fields and VV013 is Value field.
Please help me how to fix the issue.
Regards,
Amar.

Hi,
Sorry, I probably confused things by mentioning Revenue. Your settings are correct, with Revenue defined as a revenue element (11) rather than a cost element (1).
With respect to WIP (P&L), I would create it as a cost element, since it represents the absorption of cost centre costs and materials into the production of goods, even though the goods are not yet complete. When the goods are completed they will be credited in CO-OM and debited to stock using a similar entry. The impact of these credits (to WIP or to Stock) is to move costs out of CO-OM into the goods produced (CoGS). In CO-OM, the net result of Costs less credits to WIP/Stock, indicates the efficiency of your cost centres or the accuracy of your standards.
I would also create the manufacturing variance accounts as Cost Elements and settle them back to your production costs centres (or possibly CO-PA if you used it), since they are also a reflection of the efficiency of your cost centres - i.e. if a Cost Centre manager is not achieving the standards, (s)he should be accountable for the variance, and if you are concerned about reconciling CO-OM and the costs in P&L, you won't reconcile if the variances aren't posted back to CO.
Regards,
Marc

Percentage based overhead based on target cost of actual production

Hello,
I'm trying to calculate percentage overhead (overhead as a % of total cost of production) using the usual overhead group, overhead key ,costing sheet, etc.
Also put the overhead group in the material master.
Although I am getting it correctly as part of product cost planning, when it comes to calculating this overhead on a production order, it does it based on 'total actual costs' posted to the order. I want it to calculate the % overhead based on the standard cost of actual production (the target cost).
I would really appreciate some help on this.

Hi
If that's the requirement, you can achieve through template allocation. Refer the doc contributed by arturo senosain
I use a workaround for such cases. Add an activity type in routing with activity quantity same as base qty of routing.. Say, 1 PC
Maintain the activity price as .15. And you are done
Br. Ajay M

Total Target Costs not updated in Process Order

Hi All,
I have a scenario in a Process Order,
The Process order is Released, Goods Issued and GR done. But the when i go and check the Cost Analysis i did not see anything in the Total Target Costs and Total Target Qty coloumns agianst all the cost elements. It show as zero for all.
It looks very strange. There is variance in the component issues and GR as well. I simulated for the same material with a new Process order and found the vales get populated automatically on GI and GR's with variation against requirement quantity.
Could any one explain me why it is so ..? or is my understanding is wrong.....?
Thanks for your time and patience.
Regards,
Srinath V

Srinath Venkatr,
I think you are missing PP CO integration configuration during master data creation. There might be information massage to you during process order creation saying , 'Logs during Cost calculation", you are skipping the same and creating process order withought resolving the same.
Check whether you followed all the steps for product costing.
Material master,
BOM,
OPKP:-Controlling area-activate components and Controll indicators
:- Assignment of co codes
KS01: Cost center
KA01/KA06:- Primary/ Secondary Cost elements
KL01:-Activity Types
KP26:- Activity Price Planning
Then Work center/Resource- assign these cost center and activities with costing formulas.
Then Routing/Recepi-
After master data, demand management,MRP- process order. while creating process order check cost calculation errors.
Hopes that will clear your dought
Tara

Target Cost Verion in Product Cost

Hi,
I'm not able to create Target Cost Version (1,2,3.....) in variance Calculation pertaining to Product Costing.
I'm getting this message:
Version 1000 1 not intended to be used as the target cost version
Message no. KQ243
Diagnosis
The specified target cost version has not been flagged in central version maintenance as suitable for variance calculation.
Procedure
1. Check the entries in the central version table.
2. If appropriate, flag the version as suitable for variance calculation.
Please help & guide urgently.
Regards,
Viki
[email protected]

Try running a variance analysis, and see if it civd you an error message. typically this occurs when a SCE estimate was created after the process/production order was created. So check the dates of the two orders that you have, and compare with the date of the SCE CREATION.

Target Cost missing in some production orders

Hi everyone
I am observing target cost for few of my production orders. I have observed target cost is misisng in some production orders even they have status techo and dlv while some have staus rel and dlv and i can target cost for them. When i try to run KKS2 for the production order which is not showing target cost it comes up with error KV151 which says 'The quantities on which planned cost were based are zero in the time period concerned. This may be caused by the fact that no goods receipt for a cost object has been entered. This result in target cost to zero.' but we still had valid cost estimate at that for those production orders. Any help would be really apprecited
Kind Regards

Any help plz

When it is update target cost in product costing ?

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