on 02-06-2009 7:32 AM
Hi
Guru's
in production order settlement
there is 2 options, Settlement (Individual Processing ) and .) Settlement (Collective Processing)
Please suggest me what is the difference between in both settlement,
with regards
Arun Kumar
Hi,
Individual settlement is used to settlement the single order wise, whereas collective settlement is used to settle bunch of orders at a time.
Regards,
Sreekanth
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Hi!
Following are the steps for running the entire cycle :
1. Before creating production order for any material (Finished Goods / Semifinished Goods), you should run standard cost estimate for that material for that period. (CK11N for single materail or CK40N for collective materials)
2. After that you have to run MRP that for how much quantity of order you want to prepare order. Here itself you will find option for creating production order from planned order (created from MRP run).
3. You create production / process order. (CO01 / COR1)
4. Release the process order through CO02 / CR02.
5. After that you confirm the process order (CO11), by which actual consumption for raw material / packing materail will be done on process order. ( RM / PM Consuption A/C Dr
To RM / PM Inventory A/C Cr)
6.Do the Goods reciept for Order (MB31) (Inventory A/C Dr
to COGM A/C Cr)
7.Calculate the overheads on the FG / SFG through KGI2 - single Order or CO43 - collective Orders. This can be a part of your month end activity if you run overhead calcuation at month end.
8. Calculate variances through KKS2 / KKS1. This can be a part of your month end activity if you run variance calcuation at month end.
8.After that you Teco (Technically complete) the order / orders through CO02 / CR02 -> Functions u2192 Restrict Processing u2192 Technically Complete. Once you teco the order, no changes should be made to that order / orders. All open reservations for that order will automatically closed.
9. Do the settlement through KO88 for single order / CO88 for collective orders.
(Production Variance A/C Dr
To COGM A./C Cr) So, here variances would settle to your respective production order.
Pls get back in case of any query.
Thanks & Regards,
Taral Patel
Hi,
As a part of Month End process, variance and setlement process are carried out. Before settlement you carry out variance calculation process, so that based on your plan and actual cost, variance will be calculated.
Now this variance need to settle to your process order. So for that you are doing your settlement process. Before doing settlement, you need to teco your process order, after that only variance would be settled and mentioned accounting entry would be generated. Once you teco the order, after that you can not make any change and all reservation made for that order (reservations of mateail RM / PM for goods issue) would automatically closed. Generally these processes are a part of month end process.
Pls get back in case of any further query.
Thanks & Regards,
Taral Patel
Hi!
Here variance means the difference between plan cost on process order and actual cost on process order.
Plan cost would be coming from std. cost estiamte of your product for specific period. Actual cost would be actual production cost of the product which you are booking on production / process order while manufacturing.
This difference(variance) needs to settle on production order and ultimately on product.
Hope it will clear to you.
Thanks & Regards,
Taral Patel
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