Job Work (Customer & vendor are same)

[Former Member]

Dear Experts,

I need your valuable suggestions for mapping the following business process in SAP -

The scenario is that our client is doing some job work. In this scenario we receive material from X vendor & also make the sales to same vendor after some processing. We purchase material from X  & then we do the processing & sales this to X. We need to include all processing cost like electricity charges, labour charges, Lpg etc.

Kindly guide us whether the above flow is correct or not & also guide me how to include the processing costs in it.

Thanks in advance,

Regards,

Nazia

[Lakshmipathi]

First you need to have condition type for carrying out processing activity in which, electricity charges and labour charges should be included as overhead expenses.  Take the concurrence from client in case they want to show this separately.

Next from sales angle, you need to levy service tax for this process since this will be treated as a job work, if I am correct. 

Check with the Business Finance team and get the exact requirement.  Accordingly, you can map the same in SAP.

G. Lakshmipathi