Costing

[Former Member]

What is the difference between Planned Cost and Target Cost booked againt Production Order ? How it differs?

[rohit_chauhan]

Hi,

Planned cost is calculated as per the data given in master data. For example: the cost of ROH comes from BOM, the activity cost comes from routing etc. This makes the planned cost of the product.

Now when the order is confirmed, actual quantities are entered, or the actual activity times are entered etc. This gives the actual cost for the product.

So they differ in terms of planned figures and actual figure.

Regards,

Rohit.

[former_member204463]

Hi Ganesh,

Once you do the GR of that Prod Order and the status will DLV then the Target will show.

Plan cost = Plan qty * std cost estimate

Target Cost = Actual qty * std cost estimate

Actual cost = Actual qty * actual costs

for ex:

a production order is planned for producing 10 units of a material

Then plan cost on the order = 10 units * std cost

Target costs are calculated once production is confirmed.

suppose only 9 units were produced out of 10 planned

Then target cost = 9 units * std costs

Target costs are calcualted based on your BOM and the standard costs or the price of the material maintained in the material master.

Basing on the compostions of the materials maintained and their prices the target costs are calculated.

Refer to the link below -

http://help.sap.com/saphelp_46c/helpdata/en/66/bc73bf43c211d182b30000e829fbfe/frameset.htm

Regards,

Keerthi.

[Former Member]

Thanks Keethi...Its a good answer. I have awarded points.....

[rupesh_brahmankar3]

Dear,

Please refer this thread,

Regards,

R.Brahmankar

[Former Member]

Hi Keethi,

I have gone through your answer relates to the costing issue i hope you have given answer w r to REM scenario

How we are going to differentiate between planned cost and actual cost in Descrete manufacturing scenario can you answer in detail

where as we are not going to work on Product cost collector in case of DEM scenario in that case can you explan the difference between these two costs

thanks

shaik