Production order: planned & target costs in a report

[jan_turek]

Hi all,

I want to make myself clear on how the planned and target costs are reported in KKBC_ORD (cost analysis) and how/when they change here.

My understanding so far:

Target costs: they are calculated upon each variance calculation based on qty receipt and SCE valid for given period. Hence, target costs change in KKBC_ORD after each variance calculation. If variances have not been calculated (no status VCAL) the report uses the valid SCE to display them dynamically. If no SCE exists then no target costs are displayed.

Planned costs: they are first calculated as a preliminary CE when an order is created and saved. They get recalculated upon recalculating an order and also when the inputs change (changes to BOM, routing, prices in materiál master...). Hence, in KKBC_ORD we can see the planned costs changing over time - they are not fixed here from the preliminary estimate.

I know that this has been discussed many times but I'd like to have some ultimate consent in one place :-).

Thanks for any inputs,

br/

John

[jan_turek]

Hi all,

Thanks for your inputs. Imust emphasize that my question is related to the functionality of KKBC_ORD - i.e. how the costs are shown here.

For target costs, I agree that they are not calculated before variances calculation but they are visible even before in KKBC_ORD provided that a SCE exists.

As for planned costs, it used to be also my understanding that they are created as preliminary CE upon saving and order and in KKBC_ORD they *never* change. However, this is not the case. We experienced that planned costs change in the report even though order quality is still the same. So that there must be a reason that I need to track.

br/

John

[kamalkumar_biswas2]

Hi John

You mean to say that in KKBC_ORD planned cost is changed even you do not change anything in order...only 1st run one cost and 2nd run another cost like that..no way..can't happen..I never face that. Can you explain when it gets changes.

[jan_turek]

Hi Kumar,

No, I'm not saying that planned costs change just between two report runs. The thing is that for certain purposes we save the planned costs (=download from KKBC_ORD to Excel) upon the very first run when the order is just saved. Then we go back to check it several days or week later when (the order may be delivered or not) and sometimes we can see the planned costs changed. I can't explain exactly when (upon which event.) since this is what I want to know :-).

The only thing I can say is that the changes are in materiál components.

br/

John

[kamalkumar_biswas2]

Hi John

  In the following cases the plan cost will change:

  1. If order qty is changed if your order is already released

But as you are telling that it gets change even you change BOM components...but then you have to release a new standard cost also if your components is set S/3...if it is V/2 then it will change your plan cost

[kamalkumar_biswas2]

Hi John

Adding to the views of Rajneesh...

1. Target cost is the cost that calculated based on actual qty delivered multiplied by plan cost and it requires for variance calculation and will update if variance key is defined.

2. Agree with Rajneesh...only the plan cost is the cost of plan qty or order qty at plan cost/price based on BOM & Routing. If you change your plan qty/order qty the plan cost will change but cost will not change on changing of BOM components and Routing once you have released the order as said by Rajneesh

[rajneesh_saxena]

Hi John

In first part i.e. Target Cost, I agree with your views/understanding. The only thing is that I know is that if we don't calculate variance then target cost should not come. However in some clients I have seen that the system gives target cost even w/o variance calculations.

In second part i.e. Planned/preliminary cost, I differ in opinion. This is calculated based on quantity structure available at the time of  creating and saving the production order and it is not changed if after saving the order you delete any component from the BOM or change routing.

Regards

Rajneesh