WIP ( Over head cost controlling using PCC)

What is the benefit of WIP caliculation?
And also, Is WIP caliculation mandatory?

Hi Steve,
WIP Calculation enables you to value the unfinished stocks of finished products and shall be posted at the time of settlement. If there is no WIP and it is fully delivered, variances shall be posted.
As per Global Accounting Standard IAS 2 and as well local GAAP, it is mandatory to value WIP and to be shown in the Financial Statements. Otherwise, the profit arrived at is not realistic. As you are aware, once the Raw materials and activities are performed, the value is shown as consumed and shown in expenditure side of the P & L account. But in the revenue side, WIP only brings in the value of this raw material and activities consumed.
Trust this helps much and revert if you need further clarification!
Cheers!

Similar Messages

Over head cost controlling

Hi All
I am using Over head cost controlling by order, How does the values flow from product costing to COPA...mainly variances?

Hi,
If you are talking about cost object controlling by Order,product costing variances
Here you go
Variance Calculation
As long the production order is not fully delivered or flagged Technical Complete the remaining order balance is treated as WIP. Otherwise the order balance shows up in variance calculation.
If a lot-based product-controlling WIP, is valuated at actual costs. The WIP is calculated as the difference between the debit and credit of an order as long as the order does not have the status DLV (delivered).
In lot-based product controlling the variances are not calculated until the order has the status DLV (finally delivered) or TECO (technically completed). This means that at the time the order has reached this status, the system no longer interprets the difference between the debit and the credit as work in process but as a variance. In lot-based product controlling orders never have work in process and variances at the same time.
Variance calculation compares the actual costs incurred for the production/process order with the target costs according to the standard cost estimate for the finished material, and assigns the individual variances to variance categories. The target costs are calculated using the quantity delivered for the order.
In this way you can find out which variances occurred between the value of the delivery and the actual costs and you can find the reason for the posting to the price difference account for materials with standard price control.
Variances from production (target version 1)
Variance calculation compares the actual costs incurred for the production order with the target costs for the production order and assigns the individual variances to variance categories. The target costs are calculated using the quantity delivered for the order.
This enables variance calculation to find out which variances occurred between the time the production order was created and the end of the production process.
Variances from planning (target version 2):
Variance calculation compares the planned costs for the production order with the target costs according to the standard cost estimate for the finished material, and assigns the individual variances to variance categories. The target costs are calculated using the quantity delivered for the order.
This enables variance calculation to find out which variance occurred between the time the standard cost estimate was created and the time the production order was created.
Variance categories:
The system assigns every variance to a variance category. The variance category indicates the cause of the variance (such as price change, lot-size variance). Variances are updated to the information system and passed on to Profitability Analysis according to variance category.
You differentiate between variance categories on the input side and on the output side:
u2022 Variances that occur because of goods issues, internal activity allocations, overhead and G/L account postings are displayed on the input side. Price variances, quantity variances, resource-usage variances and input variances are displayed on the input side.
u2022 Variances that occur because too little or too much of the planned order quantity were delivered, or because the delivered quantity was valuated differently are displayed on the output side.
Variances on the output side occur when you deliver using a price that differs from that found by dividing the target costs and the delivered quantity. If you deliver using the standard price, a variance can occur when the order lot size differs from the costing lot size. This is displayed as a lot-size variance.
For config
3.1.4.2 Variances & Settlement
Variance Calculation determines differences between the actual costs incurred on a production order and the standard costs of the material produced. Variances are calculated not at once, but for different variance categories. The variances computed are then transferred to CO-PA.
3.1.4.2.1 Define Default Variance Keys for Plants
Use
The Variance Key is part of the order header and controls variance calculation. The system selects the value set by this step as default value when a material master is created. From the material master the variance key then is transferred to the order when an order for the material is created.
Procedure
1. Access the activity using one of the following navigation options:
Transaction Code OKVW
IMG Menu Controlling  Product Cost Controlling  Cost Object Controlling  Product Cost by Order  Period End Closing  Variance Calculation -> Define Default Variance Keys for Plants
2. Make the following entries:
Plant Variance Key
BP01 000001
BP02 000001
BP03 000001
BP0X 000001
3.1.4.2.2 Define Target Cost Versions
Use
The target cost version controls various parameters related to calculation of target costs in variance calculation. In variance calculation, target costs are needed as a comparison to the actual costs incurred.
Procedure
1. Access the activity using one of the following navigation options:
Transaction Code OKV6
IMG Menu Controlling Product Cost Controlling  Cost Object Controlling  Product Cost by Order  Period End Closing  Variance Calculation  Define Target Cost Versions
2. Choose New entries and enter the following values or copy from default settings of CoArea 0001 to BP01:
CoArea TgtCostVsn Text Variance Variant Control Cost Target Cost
BP01 0 Target Costs for Total Variances 001 Actual Costs Current Std cost Est
BP01 1 Target costs for production variances 001 Actual Costs Plan Costs / Preliminary Cost Estimate
BP01 2 Target costs for planning variances 001 Plan Costs Current Std cost Est
3.1.4.2.3 Create Settlement Profile
Use
The settlement profile controls various parameters related to settlement.
Prerequisites
Allocation Structure
Procedure
1. Access the activity using one of the following navigation options:
Transaction Code SPRO
IMG Menu Controlling  Product Cost Controlling  Cost Object Controlling  Product Cost by Order  Period-End Closing  Settlement  Create Settlement Profile
2. Choose New Entries and enter header data. Then for each new entry choose Details and enter remaining data.
3. Overview of data records:
Profile Text
YGPI00 BP Process Order w/o CO-PA
YGPP00 BP Production Order w/o CO-PA
YGPI00 YGPP00
Actual costs/costs of sales
To be settled in full X X
Can be settled
Not for settlement
Default Values
Allocation Structure A1 A1
Source Structure
PA Transfer Struct.
Default object Type
Indicators
100% Validation X X
%-Settlement X X
Equivalence Nou2019s X X
Amount Settlement
Var. to co. bsd. PA
Valid receivers
G/L account N N
Cost center O O
Order O O
WBS Element O O
Fixed asset N N
Material O O
Network N N
Profit. Segment N N
Sales order O O
Cost objects O O
Order item O O
Business proc. N N
Real est. object N N
Other parameters
Document type SA SA
Max.no.dist.rls 3 3
Residence time 3 3
You have to assign Variance Key in material master for semi-finished and Finished goods in costing 1 tab also.
To Execute
KKS1-Collective Variance calculation
KKS2-Individual Variance calculation
CO88-Collective settlement
KO88-Individual settlement
if you need anything more,let me know.
Thanks,
Rau

Over Head Costs

Hi
What are the various ways in which Over Head Costs can be allocated?
Regards
Kapil Singhvi

Costs can be allocated from sender to receiver in the following methods:
Distribution
Periodic Reposting
Assessment
DISTRIBUTION
===========
Distribution was created for transfer primary costs from a sender cost center to receiving controlling objects. During distribution, only cost centers or business process can be used as sender.
A distribution receiver can be a cost center, WBS element, internal order, cost object, or a business process. You can restrict the number of receiver categories in customizing.
Primary Postings (such as, energy costs) are collected on a cost center, and allocated at the end of the period by means of the user-defined key.
You can only distribute primary costs. During this process, the original cost element remains the same.
Line items are posted for the sender as well as for the receiver, enabling the allocation to be recorded exactly.
You can reverse distributions as often as required.
You use the Cycle-Segment method to define sender-receiver relationships.
PERIODIC REPOSTING
=================
Differences between periodic reposting and distribution are due to information content and performance.
For periodic reposting, no separate credit record is written on the sender for the cost element in the summary report. Instead, the totals record for the cost element is reduced on the debit side, which means that the original debit amount can no longer be checked there (u201Cunclean creditu201D). However, during distribution, the system writes a totals record for the credit (u201Cclean creditu201D). The information on the receiver is the same for periodic reposting and distribution (u201Cclean debitu201D).
Compared with periodic reposting, during distribution, the system also updates the partner in the totals record for the sender. This means that the partner can be displayed in the information system on the totals record level.
As fewer totals records are written during periodic reposting, performance is better than during distribution.
ASSESSMENT
===========
Assessment was created to transfer primary and secondary costs from a sender cost center to receiving controlling objects. During assessment, cost center or business processes can be used as senders.
The receivers for an assessment can be a cost center, WBS element, internal order, cost object, or a business process. You can restrict the number of receiver categories in customizing.
Primary and secondary posting are allocated at the end of the period by the user-defined key.
During assessment, the original cost elements are summarized into assessment cost elements (secondary cost element category = 42). As the system writes fewer total records, the assessment has a better performance than periodic reposting and distribution.
The system does not display the original cost elements in the receivers. Therefore, assessment is useful if the cost drilldown for the receiver is not important.
Similar to distribution, the partner is updated in the totals record during distribution
You can reverse assessments as often as required.
You use the Cycle-Segment method to define sender-receiver relationships.
Regards,
Ravi

Report to display Mat Cost Planned Labour Cost and Over head cost

Hi Abapers,
Greetings of the day..
I need a Report that Display Material Cost , Planned Labour Cost,Actual Labour Cost and Over head value
where do i start from and what are the tables involving in this report..
if already done this A code snippet is more helpful...
Thanks In Advance...
Thanks & Regards
Sathish

Assuming you are talking about Maintenance Order.
Use table: PMCO.
Here the line with field VORGA having value KPPS gives the Planned Costs of the Order in the field WRT01.
Similarly, the line with field VORGA having value RKL gives the Actual Costs of the Order in the field WRT01.
Also have a look at Tcode KKBC_ORD.
Jogeswara Rao K

Consignment with 3rd pty and cost control using MTO scenario

Hi ,
I have a scenario where my client wants to do a consignment process but alos capture the material cost into WIP. Consignment needs to use own as well as third party materials. Allthe costs need be captured and kept in WIP till customer asks us to bill for the qty used by him.
Is there any way this can be addressed using SAP std consignment process. We tried using RA Key for doing cost transfer to WIP and used the Make to Order scenario for outbound shipping , however this is not a foolproof process and has its own challenges as to Warehouse managment and consignment pick up and return process.
Can anyone pl share any thought process?
Thanks

HI
Solved by myself.
The right transaction to use is CO88 and not KO8G used for CO and PM Orders.
Claudio

How to view the Billing data,direct postings from FI and Over head costs

Dear All,
I have created a PA report by Report Painter and when I execute the report by KE30,I could able see the report for billing data by selecting the 'F' and when I want to see the direct postings from FI,I have to come back to initial screen ,then select 'B' and similarly select 'D' for overhead costs.
Can I see all data (i.e billing,postings from FI & overhead costs ) in a single report,without selecting the Record Type.
Regards
Su

Hi,
In KE35 (Form),I have defined the columns (for actuals and plan) and rows (for value fields only) and in KE32 (Report),I have defined the characteristics and variables and when I defining the VARIABLES ,I have selected 'Record Type' as one of the variable.
As you said that I have tried to remove the Record Type as a variable,but i could not remove it . Please suggest me as how to remove it and take it as a Characteristic.
Regards
Subbu

Over head cost

Hi,
In the work order we need to calculate the overheads actual cost also apart from the planned cost, estimated cost. also let me know if we have to do any cofigurational changes for this to be done?
Thanks
Vishnu Kumar

Hi,
planned cost will be calculated automatically by the system
Estimated cost has to be entered manually i.e before releasing
the order.
Actual Cost also will be calculated manually
To calculate overhead cost costing sheet has to be entered in the actual costing variant.
Try the steps mentioned below:
Plant maintenance and customer service>Maintenance and service processing->Maintenance and service orders>Functions and setting for order types>Costing Data for Maintenance and service orders-->Maintain Costing Variants.
Thanks
Arun Vijay D

Over head Costs splitting equally

Dear All,
I have created 8 activity types,but I want to split the Ovrehead Costs among 3 activity types only,but the system is splirring the costs on all the 8 activity types.
In my splitting structure,I have given activity type group by assigning the 3 activity types for which splitting is to be done.
Can sombody throw any light on this issue.
Regards
SU

hi
IN OKES, please create an assignment line, select the assignment line for the particular splitting structure. create activity type group for which the costs to be splitted and update them in selction for assignments.
in the activity group selct only those three activity types.
with out creating the splitting structure also the costs will be split that is they will be split equally. but where as if you properly assign it to the cost center then only the cost will be split as u like
krishna

Standard over head report

Hi Frnds,
In CK13N i can see all the details of a particular material like the raw materials details , over head cost and other things .which can be seen only on each material basis.
Is there any standard report where i can see all these details for multiple materials???
Regards
rajesh

Hi,
Try with the below t-codes:
*CK82, where you can provide multiple Material codes. This report provides Total cost and OH cost. If you require each component level, you can call Cost Components from the same report.
*CK83
If you would like to develop custom report use the below tables:
MBEW
KEKO
KEPH
Rgds,
ADI

Quanity based over head

Dear SAP Guru,
When i run ck11 over head cost is not comming in the cost sheet ( overhead creatd by Qty bases). How i resolve this issue?. Pls put some lights on it.
Thanks and Regards
Avudaiappan

Hi,
Pl check whether all costing sheet and overhead key have been assigned to the Production order in control data tab. Then when you do actual overhead calculation, please tick the the dialog display and detail lists, so that you can get to know how the calculation happens, etc.
Trust this helps much!
Cheers!

Actual Over Head Calculation for process order

hi!
I have created a costing sheet for over head, which will be based on labour activity cost.
the base is labour cost for which I have given secondary cost element ( assigned in activity type for labour hours) in costing sheet and maintained over head rate for planned & actual. in credit of costing sheet for over head I have given secondary cost element with internal order.
first question is : when internal order posting will happen? I am assuming , when production order settlement is done, over head cost has to be accrued to internal order. is my assumption is correct? because in line items of internal order , i couldn't see any thing.
second question is : in process order, system is showing over head cost under planned cost, but it is showing ZERO in actual cost column. I have executed KGI2, system is not showing any senders or receivers. but when I executed KGI2 with dialog dipslay check box, system shows the calculations as per cost sheet correctly under condition value column.
Please let me know where I missed ? how to get actual over heads in process order.
in process order in cost analysis in the actual/target cost layout, system is showing the over head costs. but where as in "cost trend" layout, system is not showing over head cost.
can any one help on above points.
regards,
ramesh b

Hi
Maintain the Overhead rate in KZM2 or KZZ2 as the case may be
Then execute CO43... The moment overhead is charged to Process order, it would post credit to IO
br, Ajay M

Frieght and Over head

Dear Experts.
We have set the frieght percent and the purchase over head percent in mek1. But still we are not getting the frieght and purchase over head cost while rolling cost. May I know the reason

Hi,
Under Tcode OKKN and in the Valuation variant u can give the following sequence and check if it giving requisite results:
Priority                        Strategy sequence:
1                                 L Price from Purchasing info record
2                                 4 Planned price 1
3                                 2 Standard price
Sub strategy sequence:
Priority                        Strategy sequence:
1                                  B Purchase order price via condition table
Thanks,
Prithwiraj.

How to Close Planned Over Heads in product costing

HI,
We are maintaining planned over heads through KP26 and Costing sheet.Kindly tell me how to close planned over head wether it is periodicall closing or other?
Kindly provide me the guide lines how to do this Planned overheads closing in the system?How many ways are there to close planned overheads in the system?
Kindly adviice me?
Thanks
Sunitha

Dear Sunitha,
To run the Cost estimate or close the planned overhead KP26 and Costing Sheet is not enough you have to move forward and you need to define Cost component Structure (OKTZ) Path: SPRO > IMG > Controlling > Product Cost Controlling > Product Cost Planning > Basic Setting for Material Costing > Define Cost Component Structure. After maintaining cost component structure you need to define Costing variant T.code OKKN Path: SPRO > IMG > Controlling > Product Cost Controlling > Product Cost Planning > Material Cost Estimate with Quantity Structure . Here you copy PPC1 standard and create your own costing Variant.
After Maintaining the Configuration go to T.code CK11n and run your costing and if it is correct then save it. To update Price in MM run T.code CK24 and release Material and update it.
thx.
Ganpat

Firefox is caching my website page even http cache-control header was in use

Hi
Http header "Cache-Control: private, no-cache, no-store, must-revalidate" was used but firefox still caching my webpage. authenticated page of website can be viewed by using work offline feature of firefox.
Please Help
Thanks
Prasant Sharma

https://developer.mozilla.org/en-US/docs/HTTP_Caching_FAQ
CORS was added to Firefox 29, IIRC. <br />
https://developer.mozilla.org/en-US/docs/Web/HTTP/Access_control_CORS
Have you looked into Page Info, specifically the Meta Tags? <br />https://support.mozilla.org/en-US/kb/page-info-window-view-technical-details-about-page

Adding over heads to the process order

Dear All,
We are executing one projrect for which production of goods will be started from 01.01.2012.so for this we need to caculate cost of the product before the production order executed.
For RM one BOM will be created & issued to the production order so that the cost of RM can be identified with the production order.
For Over heads we need to provide the facility to enter manually for each order based on qty. & rate in the production order.
So that before the production order executed the total cost of the order can be arrived.
Now pl. advice how to provide the facility to enter manually for each order based on qty. & rate in the production order
Thanks
Shivaji

HI shivaji mohanty,
I have seent the same process in the Production Order. I hope it will work to process order also. Pl check the path
Contorllling --> Productin Cost Controlling --> Basic Settig for Material Costing --> OH Key & OH Group.
Pl do the necessary setting & assign the Process Order!
I hope it will work. pl check & revert back!
Regards
Raj

WIP ( Over head cost controlling using PCC)

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