Skip to Content
0
Former Member
Apr 19, 2012 at 10:26 AM

Variance Calculation Issue: Product cost by period

193 Views

Hello All,

We are currently using product cost by period with manufacturing orders in SAP ECC without product cost collector.

The WIP is at target cost which is based on standard cost estimate. Based on operation confirmations the WIP is calculated.

If we do not do any goods receipt (delivery) no target costs are calculated and thus all the variances are collected on the remaining variance category. Standard SAP also suggests that variance calculation takes places with DLV or TECO status and/or when goods receipt takes place.

Now, what we observe is that if in period 1, if we book actual costs on the production order, but we have no delivery of the product we are producing, then everything gets collected in the remaining variance category. And say in period 2 if we complete the order with some more actual costs and delivery of the product we are producing, the variance gets calculated but it looks at only actual and target costs for the period and does a correct variance analysis for the period 2. The previous period variances that are collected on the remaining variance category are not corrected and still lie in the remaining variance category. So when we analyse the variance analysis for the order on a cumulative basis it doesn’t show a correct analysis since period 1 variances are not corrected.

Please provide any inputs regarding the issue and also let us know if this is SAP standard for product cost by period.

Thanks.

VS.