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Make-to-Order : Cost Object

Dears

In a make-to-order scenario, what should be the Cost Object normally ?

I think it is 'Sales Order'.

Is it necessary that make-to-order should always have Sales Order as Cost Object ?

What is the benefit of making SO as a Cost Object in make-to-order ?

Please clarify to ward of my confusion.

Thanks

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3 Answers

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    Former Member
    Jan 14, 2015 at 11:04 AM
    10

    HI Nikki,

    In nutshell MTO scenario work like this,

    1) MTO scenarios can be with sales order as cost object and with /without sales order stock (special stock) meaning stock can be specific to sales order or normal stock.

    2) MTO can be with production/process order as cost object with /without sales order stock (special stock)

    3) In some Complex MTO Production,where sales order alone does not provide all functions,you can combine the sales order with other cost objects, such as projects or networks. This is especially recommended for complex make-to-order production scenarios. In such cases Projects becomes your cost object and sales order will be only a logistical object.

    So there is no hard and fast rule to keep sales order as cost object. It only depends up on the business requirement.

    BR
    Karthikeyan

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    Former Member
    Jan 12, 2015 at 09:25 AM

    Hi Saju,

    1. In MTO Production order is the cost object if your SO is not a cost object. If your SO is cost object then SO and Production Order will become the Cost objects.

    2. It is not necessary to SO as a object in all the cases.

    3. If your SO is a cost object then you can book exences at SO level, if not you cant book expendure against your sales order.

    Regards,

    Ram

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    Former Member
    Jan 12, 2015 at 09:39 AM

    Hi Saju,

    There is not standard cost object for any order, its purely based on the requirement we can set the cost object.

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