Former Member

### period end closing for production orders

Dear all,

what is period end closing???

Pl. enlist all period end activities for product costing by order scenario.

what FI entries required to post??

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Former Member
Aug 19, 2007 at 08:58 AM

With respect to PP- Period end closing is the procedure to close all the production orders and see that cost is flowing from production order to material

During period end - we TECO all the orders and see that production is complete from PP angle. Then costing will calculate over head/variance and settle the difference to production material or price difference a/c depending on the production material price control.

Just see below the example of a production and costing entries. Thi8s may be helpful to understand the concept.

Planned price

Planned Material cost = 115.15USD

Planned Activity cost = 6 USD

Planned Over head = 25% of material cost+ 250% of activity cost = 28.79+15=43.79

Total cost = 164.94

Product cost as per S price = 1 USD (example)

After GR and confirmation

Actual Material cost = 7456.55 USD

Actual Activity cost = 2USD

Total cost = 7458.55

Actual O/H = 0

Production variance = 7293.61 USD

After o/h calculation

Actual Material cost = 7456.55 USD

Actual Activity cost = 2USD

Actual O/H = 25% of material cost+ 250% of activity cost = 1869.138

Total cost = 9327.69

Production variance = 9162.75

After settlement

Actual Material cost = 7456.55 USD

Actual Activity cost = 2USD

Actual O/H = 25% of material cost+ 250% of activity cost = 1869.138

Total cost = 9327.69

Production variance = 0

Variance will be settled to Price difference a/c.

When we do the GR the FI a/c will hit as below

Production order expense a/c -

stock a/c +

When we GI the following a/c will hit

Raw material a/c -

Production order expense a/c +

When we settle

Production order expense a/c + or -ve

variance a/c = + or -ve

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• Former Member

Rajesh,

Your answer was very helpful to me. The example helped me picturised the process flow. Can you put some light on WIP calculation in this process flow will similar example?

How will be accounts affected due to WIP calculation?

Thanks,

A

• Former Member
Aug 17, 2007 at 11:49 AM
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• Former Member
Aug 17, 2007 at 12:17 PM

Hi Ranjeet

You can use the tcodes for MMPV-CLOSE PERIODS. Once you close the period and after that use the tcode for MMRV-Allowing posting period to previous period.

you can colse the period by using MMPV and after that you can post that particular period by using MMRV.

Also check fot the below link

http://help.sap.com/saphelp_46c/helpdata/en/46/f42c7dd435d1118b3f0060b03ca329/frameset.htm

Regards

Dhananjay

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• Former Member
Aug 17, 2007 at 12:17 PM

HI Ranjeet

we do period end closing after when we do TECO for Production order

for all TECO do Overhead calculation KGI2 for ind. and col. CO43

then do WIP calculation ind. KKAX and Coll. KKAO

then we do Veriance calcul. ind. KKS2 in Coll. KKS1

then in last we need to do settlement KO88 and CO88

Thanks

Bala