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Single level and multi level price determination in Material ledger

Former Member
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Can any body explain what does mean by single level and multi level price determination in material ledger.

Accepted Solutions (1)

Accepted Solutions (1)

marialuisa_munoz
Contributor
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Hi,

As remarks, the terms of single and multilevel price determination are related to Actual costing.

Materials which are to participate in the actual costing get price determination control 3 (single-level/multilevel material price determination). Goods movements of such materials are valued with a
preliminary valuation price first. However, the price variances which often occur with procurement transactions are collected per material in the material ledger and displayed immediately in the materiel ledger data display (Transaction CKM3).
At the period end, the collected price differences are assigned to the consumptions and the ending inventory of the material (single-level price determination). Price differences which are assigned to multilevel usages are rolled up to the next higher manufacturing level (multilevel material price determination).

The Material Ledger is focused on material on their procurement process. The procurement process of a material is not restricted to external procurement but also refers to internal procurement (production, company transfer,..).

The term single-level always refers to one material and its procurement process; that means that all values and quantities  that arise during a procurement for said material are stored "single-level".  The multilevel level price determination is related to price differences which are rolled up from the input to the output material.

Best regards,         

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