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Former Member
Apr 20, 2007 at 10:47 PM

Profit Center Acct - What/How to do's?

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Hello Experts,

We are implementing PCA for Business Unit reporting which are defined by our product lines. We have a problem which I know many of you must have faced.

PCA is populated in the Material master. And we have raw materials and indirect materials which go into more than one product line.

For Raw material issue, at the time of production order confirmation, we are taking the profit center from the Finished goods material master. However, the same Raw material when it is purchased has the profit center based on the RM's material master.

Now the decision as to which profit center should be maintained in the RM material master which is being used in multiple product lines is based on the demand planning of the product. The product whose demand is more, that profit center goes into the RM master.

Now my problem is that it is not a very good practice. My all RM purchase will go into one PC based on the demand plan, whereas my inventory and WIP goes to different PC's. This goes against the matching concept in accounting.

Does anyone has best practices of how to deal with such situations? May be our design is wrong and this is not too late for us to change.

Thanks and regards,

Vishal Thakur