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Product Costing without use secondary cost element

Oct 04, 2017 at 08:59 PM

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Former Member

Hi Experts,

I have a client with this request:

1. They have SAP system with PP, PM, SD, MM, FI, CO, Material Ledger modules.

2. They use maintenance orders, production orders, cost centers.

3. To carry on cost from cost object to other they use settlement, assessment, revaluate rates, with secondary cost elements.

4. REQUEST: They need to report the production cost with primary cost element only.

They tried with abap program without good results.

Now they want to try using Distribution method and Settlement with the same primary cost elements.

Step 1: From "Maintenance Labor cost center" to "PM Orders" using Distribution.

Step 2: From "PM Orders" to "User Cost Center", using Settlement with primary cost elements.

Step 3: From "Indirect cost center" to "Direct cost center" using Distribution.

Step 4: From "Direct Cost Center" to "Production Orders" using Distribution.

I would like to know your opinions. Is it feasible?

Thanks in advance for your help.

Regards,

PEP

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3 Answers

Best Answer
MALAY VAKIL Oct 31, 2017 at 05:14 AM
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Hi Pep,

My opinion is below:

Step 1: From "Maintenance Labor cost center" to "PM Orders" using Distribution. --> Technically feasible,

Step 2: From "PM Orders" to "User Cost Center", using Settlement with primary cost elements--> Technically feasible, you have to run program "

RKALPSAC" so order will become valid sender object

Step 3: From "Indirect cost center" to "Direct cost center" using Distribution.--> Feasible

Step 4: From "Direct Cost Center" to "Production Orders" using Distribution.--> Not possible system will not allow to transfer cost from cost center to production order through dist / allocation cycle

Regards,
Malay

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Holger Homann Oct 05, 2017 at 06:59 AM
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Strange requirement I never heard about something until now but I would use a Primary cost Component structures as an

auxiliary structure and assure that all my activity type rates are planned with a cost Component structured (Primary cost componet) which is automatically rolled up in the product costing.

Step 1: direct activity allocation with rates and Component structure

Step 2: agree -> settlement with origin cost elements

Step 3: agree but you could use indirect activity allocation too if you maintain a cost Component structure in your co version (same as step 1)

Step 4: see Step 1

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Hey Holger,

can you explain how will you use Cost component structure in PM Orders as u mentioned in step 1, 3 and 4. a far as i know it is used in product costing.

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activity prices with cost component structures can be used through the whole controlling if you add one to your co version. the fi/co part of PM orders is the same

But your assumption is correct ... the transfer from pm order to the cost center is not able to use the cost Component structure anymore.

Hmm ... that was my first and only idea ...

As Muhammad already said you can not use PM orders in Distribution cycles but you can use internal orders and then do a settlement on a origin cost element base.

But if this is a legal requirement in your Country I am you browse your local SAP consultancies maybe there exists already a 3rd Party solution.

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Muhammad Usman Akram Oct 07, 2017 at 08:36 PM
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i dont know why your company require this but as per my understanding solution is as under:-

Step 1: From "Maintenance Labor cost center" to "PM Orders" using Distribution.

as far as i know you cannot use PM order in distribution cycle. how ever through direct activity allocation KB21N you can post cost on PM orders.

Step 2: From "PM Orders" to "User Cost Center", using Settlement with primary cost elements.

it is possible to use primary cost elements with the help of source structure and allocation structure

Step 3: From "Indirect cost center" to "Direct cost center" using Distribution.

distribution cycle is used to allocate primary cost only.

Step 4: From "Direct Cost Center" to "Production Orders" using Distribution.

not possible. system will not allow you to allocate cost. infect you cannot create distribution cycle while using Production order as receiver objects

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Former Member

Hello Muhammad,

- The company needs the original accounts at level of Production Orders, then convert it to a Group account for reports requested by the parent company.

- I have used BS12 transaction to allow Distribution with PM Orders and PP Orders as receiver objects.

- I have executed the cycle and it was ok.

- I have only observed that the report CKMLQS would no longer work because activities types are no longer used.

- I executed Material Ledger until Multilevel Calculation step, and this goes well. I hope there are no other consequences.

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thats great. i know with BS12 you can activate it but am confused about standard cost estimate with activities. and PP confirmation.What would be your PP confirmation step? will it be without activities? how will you calculate standard cost estimate if you are not using activities.

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