sub contracting cost

[Former Member]

Hi All

I want to know how to capture subcontracting cost in Product cost / Sale order costing.

example, Material A process 1 is processed within in the company and process 2 is send outside to process further and process 3 of the same material is process inside the company.

Now how to capture process 2 cost which is process outside the Company.

2. Also incase there 2 materials in the BoM and 1st material is processed inside the company and 2nd material is processed outside the company now how to capture the sub contracting cost

Aravind

[Former Member]

Hi,

For Scenario 1: Operation 2 is an external processed operation. Hence that operation will have a different control key. this operation also has a cost element and a Purchase info record. The cost of this opearation is taken from PIR and is reported under the cost element entered in operation in cost estimate.

However, for logistic purpose, this scenario is not recommended since it is difficult to trace the flow of materials going to vendor and return.

For Scenario 2: The cost of material B is the material cost (obtained from BOM), subcontracting cost( this is obtained through valuation variant "subcontracting" tab strategy sequnce), overhead cost if any through costing sheet.

The cost of material B is then rolled up to material A, since B is a component of material A. Hence in cost components of A you will see the subcontracting cost. However you will not see it under itemization view (no item with category L).

Hope this answers.

Regards

Chetan.

[Former Member]

In your first example you do not have separate materials, so you will have to make use of an external activity. I would suggest though that you create an extra material, for the goods that come back form the supplier, it is usually much easier to handle.

In your example 2, I would just use normal sub-contracting functionality, i.e. make use of a sub-contracting purchase order.

[Former Member]

Hi

you can capture the subcontracting cost via valuation variant. In valuation variatn we have seperate cost determination for Subcontracting apart from the normal material valuation. You can select the option to determine the same from pruchase order or quotation etc..

~Thanks!

Rajesh