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Material valuation procedures

 

In an manufacturing firm most of the externally procured materials are stored before they

are required  for production or sales. The stock of such material must be updated on quantity and

Value basis .The material valuation determines and maintains the stock value of a material. The following formula is used to calculate the stock value

Stock value = stock quantity * material price .

 

The valuation area is an organization level  at which material is valuated . It can be either company code

Or plant which we can configure in the customizing transaction OX14 ( Menu path is

Customizing Enterprise structure -> Definition -> Logistics General -> Define valuation level)

The price control procedure in material master record determines the value used to valuate the goods receipt

Of a material. Material valuation can be carried out according to the standard price (S price) or the moving

Average price (V price)

 Standard price

System calculates the total stock value for materials with standard price control as follows

Total value = Standard price * total stock

 Moving average price  

System automatically calculates  the moving average  price for every goods movement as follows

 

Moving average price = total stock value / total stock quantity

 

Calculating MAP variance

 

Go to the table MBEW for the material and plant . Make note of the    number under MBEW-KALN1. Go to the table CKMI1 with that number. Enter the number at field KALNR. Follow the menu path Options -> User       

parameters change to ALV Grid display. Now select the two columns for DATUM and UZEIT sort according to both of them (in ascending or descending  Order, as you prefer).Here locate your document. You will see: the stock   before the posting (LBKUM), the value before the posting (SALK3) and a     

column with the MAP and another with the standard price            

 image

 

 

Each field represent the following

BDATJ                             Year

POPER                            Posting period

AWTYP                            Reference Transact.

AWREF                            Reference Document

AWORG                           Reference Org Unit

GLVOR                             Business Transaction

LBKUM                             Total Stock

SALK3                              Total Value

VERPR                             Moving price

STPRS                             Standard price

BWKEY                            Valuation Area

DATUM                             Entry Date

UZEIT                               Time of Entry       

 

Based on the FI document of each reference document we can able to see how each posting

affected the MAP variance .

Reference content

 

http://help.sap.com/saphelp_470/helpdata/en/47/60ff4849f011d1894c0000e829fbbd/frameset.htm

 

SAP Notes

209864 – Moving average price is disproportionately large          

185961 – Moving Average Price Calculation                          

 88305 – Moving average price zero set; no accounting doc.         

 88320 – Strong variances when creating moving average price       

 79483 – MM-IM: Creating the moving average price.                 

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