Cost rollups

[Former Member]

Hi,

Can any experts help me with cost rollups. We have different cost componets under which costing results are collected. But how does each components connected in cost rollups. Like how do we know which one is the low level cost component that can to rolled up to which high level cost component. Where is the like for each cost componets for cost rollups?

Thanks,

Nivi

[Former Member]

Hi,

As you must be aware the purpose of a cost rollup is to ensure that the cost of goods manufactured (material and production costs) of all materials in a multilevel BOM are included in the cost estimate of the higher-level material. This is achieved by assigning the costs in a cost estimate to cost components.

The cost components are established by grouping together cost elements. This provides transparency into the type of costs, such as material, activity types or overhead that comprise a product.

And when a multilevel BOM is costed, the costs are rolled up. That is, the cost components of the cost component split are passed upwards in the hierarchy to the cost estimate of the higher-level material.

For each material, the cost component split provides information on:

The value added of the material (upper level).

The costs of the subordinate materials (lower level).

Up to 40 cost fields can be rolled up in a cost component split.

A cost component can carry fixed and variable costs.

Provide points if found usefull

Thanks,

Praveen

[Former Member]

Hi Praveen,

Thanks for your detailed reply. Can you please explain me a more for the following,

when we save a material cost estimate ( here does it means any material cost estimate in a BOM?) , the system automatically updates a cost component split for each costed material in the BOM. For which we should have already defined,

<b>Which cost components the calculated costs should be assigned to ( No clear idea)</b> - If possible can you please explain me with an example what this calculated cost means.

Which cost elements are grouped into which cost component ( I hope for which we assign cost elements intervals or cost element for different cost components.)

I found your reply very useful, thanks again.

Regards,

Nivi

[Former Member]

when we save a material cost estimate ( here does it means any material cost estimate in a BOM?) , the system automatically updates a cost component split for each costed material in the BOM. For which we should have already defined,

<b><i>Yes you are right, when one materials is costed, the cost of that materials is included in the cost of materiaals where it is mentioned in the BOM.</i></b>

Which cost components the calculated costs should be assigned to ( No clear idea) - If possible can you please explain me with an example what this calculated cost means.

<i><b>Cost components means, Raw materials, labour, oveheads etc.,</b></i>

Which cost elements are grouped into which cost component ( I hope for which we assign cost elements intervals or cost element for different cost components.)

<b></b><i></i>Yes, you have to defined the cost elements of all the materials, overheads etc., in the cost component structure which would be used in the materials cost estimate.

I hope it is clear now.

Regards,

Suraj<b></b><i></i>

[Former Member]

Hi,

which catagory provides details about the follwing (upper, lower levels) in the cost component split or how do we know that this cost component in a cost component sturcture is the upper level componenet and this is the lower level component,

The value added of the material (upper level).

The costs of the subordinate materials (lower level).

Thanks,

Nivi