Cost Center Variance and revaluation of activities at actual prices

[Former Member]

Dear experts:

1. I'd like to know, given the complexity of setting up in customizing and entering data by users, as well as interpretting the results of variance calculations based on actual activity price calculations, I am wondering how many percentage (roughly) of SAP implementations actually use actual activity price calculation, splitting structures, and revaluation at actual activity prices at month-end.

2. Do you calculate actual activity prices for those consumed in production order via routing and revaluate to get actual production costs?

Those of you who have been on many implementations are requested to share their insights. This will help me assess how deeply I need to study AC412.

Your words of wisdom will be truly appreciated with reward of points.

[Former Member]

Hi Mohan

Usage of SAP functionalities like actual activity price calculations, splitting structures and revaluation depends on client. If the client is sure of its impact and is confident of ensuring posting correct data they use it. If the client has an environment where they cannot enforce or control activity confirmation corrections in plant, the costing guy does not go for these functionalities. There are two situations

1) Actual activity qty is entered and costing is done with plan prices, in which case the variance is purely quantity variance

2) Else plan qty is consdered as actuals and also the price, in which case no activity cost variance occurs

Or u can do following

The usage of these functionalities are purely dependent on client

Where accuracy of data is ensured u can use the above functionalities and yes we calculate actual activity prices and also revaluate the production orders at month end to get actual production costs

Pls assign points if the above helped ur cause

[Former Member]

Thanks, and how about activity dependent and independent cost planning use?

Can you give me example from your actual implementation where these were used?

[Former Member]

Hi Mohan

Activity Dependent costs means costs are directly related to the activity and are incurred only activity is performed. Ex. Labour costs are related to Labor Activity

Activity Independent costs = These costs are not dependent on performance of activity. Ex. let's say there are two activities performed in a cost centers MHRS and Set Up. You wish to calcualate activity rates for these. Certain expenses are incurred in the cost center, you need to do cost splitting to calculate the rates for these two activities since the costs are independent of activities. Here you also plan costs as activity independent in cost center planning. You have to define splitting structure and then do price calculation.

Please assign points if the above clarifies and is useful

Let me know if you wish to have guidance on planning part

[Former Member]

We are using Actual Revaluation for Activities successfully, but we have one small problem. We have a few cost centers that have low activity and thus we do not wish to revalue them at this time. We are using the single activity type in manufacturing cost centers as well as tooling cost centers (we do not wish to revaluate tooling). The SAP solution is to use a different Activity Type that does not revaluate. The problem with that is our labor collection system only allows one type without a very expensive change order. Our only solution at this time is to go to KBK6 before the Revaluation at Actual trx (CON2/MFN1) and edit the actual prices to the planned. I would like to know if anyone has a clever way to stop these cost centers from revaluating the activites without resorting to our given two solutions? The only two solutions so far are to use different activity types or to edit the KBK6 values to plan.