cost element & cost element & activity type relationship ?

[Former Member]

He experts:

I am a novice at controlling .

When I read the document , I have a little trouble in understanding cost center , cost element and activity type.

Hope some can explain me what are cost center , cost element and activity type and their relationships?

It's better to have some examples .

Thanks a lot.

[Former Member · Accepted solution]

Hi

Simply

Cost element - is the cost carrier from FI to CO, like a integration point.

Cost Center - is the cost bucket (e.g. production cost center incurrs the machinery cost)

Activity type - is the activity within the cost center (e.g. machinery hours) - used in product cost calculation

VVR