make to order and make to stock scenarios in prodcut costing

[Former Member]

Dear Co Experts,

I am new to product costing, in product costing there are two way to estimate the cost of the product by using make to stock and make to order.

Kindly tell me the scenario of make to order and make to stock

In make to order scenario what are the minimum configuration steps are required in controlling, PP, MM, and SD.

In make to stock scenario what are the minimum configuration steps are required in controlling, PP, MM, and SD.

How we will defend the costing variant in make to order scenario

I really appreciate for your early response

pls tell me end to end cycle for both the scenarios

Warm Regards

Venkataswamy

[Former Member]

thanks

[Former Member]

Dear All,

WIP is calculated when the Production Order status is DLV; this statement I have seen on the above Dublin point. Is it correct; i hope WIP is calculated when the Order is REL Status.

When ever the goods are delivered then, means the goods are in Customer hand, then how can we calcuate the WIP; is it correct; Correct me if i am wrong.

Regards

[Former Member]

That is ok but, my doubt is

ofter doing WIP,Variance analysis and settlement, where it will be effected and how the accounting and costing document will be generated

Regards

venkataswamy

[Former Member]

Hi

Some of the FI entries would be like

On Issue of materials

Consumption Dr

Inventory Cr

On Receipt

Inventory-FG/SFG Dr

Cost of goods mfd Cr

In case of WIP at period end

WIP Dr

Change in stock Cr

(This will get reversed on confirmation in following period)

For variances (at Settlement)

Cost of goods mfd Dr/Cr

Production variances Dr/Cr

Regards

[Former Member]

Hi,

In the reporting point of view how the wip variance and settlement will effected in accounting and costing side

Regards

venkat

[former_member184655]

Dear Venkataswamy,

Check this link,

http://wiki.sdn.sap.com/wiki/display/ERPFI/Product+Costing

Regards

Mangalraj.S

[Former Member]

Hi sir,

a) WIP will be calculated,when Production order status reaches CONF or DLV and will be reversed in the next period.

b) Variance will be calculated when Order status reaches TECO or CLSD.

c) Order Settlement will result post calculated variance and also Order Settlement allowed when system statuses should be TECO and/or DLV.

Thanks for your valuable information and i have one more doubt

ofter doing WIP,Variance analysis and settlement, where it will be effected and how the accounting and costing document will be generated

regards

venkataswamy

[Former Member]

Hi

In Cost Planning in Product Costing,We configure Cost variant

Costing variant is a A tool that contains all control parameters for costing, including

parameters that control how cost estimates are executed and the material

prices or activity prices that are used to valuate the costing items.

In Cost Object Controlling category a)by order b)by period c) sale order

a) BY Order,We create Co Production Order which will be used in Make To Order Production.

b) By Period,We create Product Cost Collector which will be used in Make To Stock or Repetitive Manufacturing

c) By Sale Order,We create sale order with linked to Co production order,We can use Make To Order Scenario.

www.sap-topjobs.com/SpecialPP/samplepc.doc -

Regards

Edited by: Dublin on Oct 19, 2009 10:02 AM

[Former Member]

Thanks for your valuable information

i got the all the information regarding the Make to stock (REM) SCENARIO

But i didn't get the information for make to order scenario.

Kindly explain the make to order scenario and what are the minimum configuration are required in this scenario

Regards

venkataswamy

[Former Member]

Hi

In Repetitive manufacturing setup say glass manufacturing receives Bulk Order from Car Manufacturer and clients wants to analysis cost of this specific Order then you go for MTO scenario.

just have look at below link for production order configuration

Regards

Edited by: Dublin on Oct 19, 2009 12:23 PM

[Former Member]

Thanks for your valuable information

How WIP ,Varaince caluculation and settlement will happen in make to order scenario

and where it will be effect and at a time we can settle both cost and revenues

Reagrds

venkataswamy

[Former Member]

Hi

a) WIP will be calculated,when Production order status reaches CONF or DLV and will be reversed in the next period.

b) Variance will be calculated when Order status reaches TECO or CLSD.

c) Order Settlement will result post calculated variance and also Order Settlement allowed when system statuses should be TECO and/or DLV.

Regards

Edited by: Dublin on Oct 19, 2009 7:33 PM

[Former Member]

Hi,

The two scenarios mentioned by you are standard SAP CO-PC .

Please read the help or go through these scenarios from Ideas examples given in 4.6c version OR read AC505 Training material.

Thanks - GS Rao

[Former Member]

i have read the this doc but i am not understanding

Regards

venkataswamy