Hello Friends,
I try to put together a common document for Actual Cost, the information is available in SCN forums and i try to put it together in a document form so it is available at one place,
In my earlier Documents I have explained about standard costing and various settings required for executing Standard Cost estimate. In this document we will talk about more on Actual Costs.
T-code KKBC_ORD – Looking at below screenshot it shows the actual cost postings at different time of transactions and its origin. I will try to explain where does these things flow from.
Figure 5.1
Note- KKBC_PKO can be used to see the above transactions as well.
There are several business transactions where we got actual costs; based on posting origin we can divide the transactions External Postings ( Any other module origin such as FI, PP, SD, MM) to Controlling called Primary Cost.
Business transactions within controlling module called Secondary costs we will see in detail about these in this document. I must say there is various documents and discussion in Forum about these things. However i would like to elaborate more on what is the financial impact during different stages of transactions
Primary Costs
We will take example of production order here, During Goods are issued from Inventory P/L account is debited and B/S account is credited automatically. For this we generally create identically primary cost element of consumption account. Posting to these consumption accounts (primary cost elements) also generate parallel postings to a controlling cost object. In this case
At GI:
|
At GR:
|
Figure 5.2
Outside buys, sub-contracting scenarios where we purchase services or goods are recorded as credit to GR/IR account and debit to external expenses account.
Secondary Costs
When the production activities confirmed, the cost center is credited and product cost collector is debited. A production cost center receives debit due to primary costs such as payroll, Electricity etc. Confirmation of these activities allocates these activities across many products.
Figure 5.3
Credits
Finished goods are derived from the production order. The credit value is calculated by multiplying standard price by finished goods quantity delivered to inventory .Total variance is the order balance
Figure 5.4
This balance post after the variance calculation, this is basically the difference between standard cost and actual cost. Now let’s talk about actual cost
Post Actual Cost Let’s create and release a production order CO01.
Figure 5.5
Confirm Activities CO11n, while confirming you can see there are different this is when the actual Secondary cost get posted to Controlling.
There is no accounting entry for activity confirmation only CO postings happens
Dr Production order
Cost center Cr
Fig 5.6
and during Activity confirmation posts accounting with below entry
Dr. Activity cost GL(P/L)
Activity cost GL(P/L) Cr
During closing activities we execute several other transactions to settle the costs, Overhead calculation and the variances. I will try to cover these in my next postings.
Note-This is basics document and intended for basic understanding of Actual Cost.I will continue to edit the document after the suggestion.
Best Regards
Hrusikesh Dalai
Hrusikesh,
I am liking your documents, I am still reading your other documents about standard costing, This one is simply great very simple to understand.
keep it up!!
Sushma
Sushma,
I am glad you like it, Thanks for the comment it is always great to receive that first feedback.
Hrusikesh
Hrusikesh
It’s very good document.
Thanks & Regards
Satish
Thanks Satish,
i appreciate your comment.
BR
Hrusikesh
plz anyone help me for sap fico support project document..
Maheswar,
Sorry i never heard if we have any specific document for that, You may need to specify what documents you need and then seach the forum.
BR
Hrusikesh
Hi Hrusikesh
Nice document, can you please share a document on actual activity rate calculation and revaluation of production order with actual activity rates T.codes KSII and CON2…. because that will complete the cycle.
I am actually looking for these closing activities of CO
Regards,
Sumit Koshal
Sumit,
My next document will emphasize on the same. I hope it to complete it soon.
BR
Hrusikesh
hi all i am new to this site could any one please tell me where will i get asset accounting material and controlling material . thanks
very good article mr.Hrusikesh ..
Thanks Mr Sada for your comments.
BR
Hrusikesh
Thanks for sharing valuable information…
Thanks Mariks and i appreciate your ratings.
Hi,
Those are Five star series,
Devendra
Devendra,
I appreciate your comment and motivating words.
Thanks
Hrusikesh
Hi Hrusikesh,
Thanks for your comment,Your contribution definitely superb,
It is the big task for the consultant to explain the subject in simple and easiest manner,You have made it through your FIVE STAR SERIES.
Really great,
With Regards,
Devendra
Hi Hrusikesh Dalai
Great explanation and good effort to cover on this topic.
Regards
Raheem
Thanks Raheem appreciate your comment
Good document.. Nice explanation.
Regards,
Sudeep.
Thanks Sudeep.
Hrusikesh,
i am great admire of your series. This helped me a lot.
THanks for simplifying it.
PRasad
I am glad it helped you Prasad. Thanks for the wonderful words.
Hi..
I think that if you use standard cost for raw material and calculate actual cost through material ledger, KKBC_ORD don’t report actual Data.
Because raw material’s cost in KKBC_ORD report is only standard cost, not actual cost.
Yes i agree Big Choi ! Sorry This document covers the topic where Material ledger is not active. I am sorry i should include this somewhere in my Notes. Thanks for clarifying and explaining.
Best Regards
Hrusikesh
Hi,
All the goods movements in process order or production order happens only at Standard price. The actual cost column gives Actual qty x Standard price. Here system will not take actual price.
Regarding activities, after revaluation of order we get actual hours consumed x actual price calculated in KSII.
Regards
Anand
Anand,
thank You for looking at it, I agree well this document is intend for basic understanding of Actual cost i will come up with my next document which will cover more topics like variances and period end closing activities.
Thanks.
Hrusikesh
Hi Harkush
I like your documents. almost I have read all and can say that you are doing a commendable service.
BR Shalabh
Shalabh,
I am glad you liked it.
Thanks
Hrusikesh
Very good article. Simple and easy to understand. Clear explanation
Thank you for your comment!
Hi Hrusikesh,
Thanks a lot for sharing this document.
I have one question: In accounting principle we have 4 types of valuating the inventory throughput method, direct or variable costing method, full absorption method and the activity based costing method. SAP supports only activity based costing method or all.
Can you please share the configuration document related to Activity costing set up?
Thanks in advance:)
Regards
Subhasis
Subhasis,
Ans-All method .
SAP has flexibility in design which can support all of these methods.
I have not having any document but there are several available in SCN and sap help.
Thanks
Hrusikesh
Hi,
Very Informative material.
Regards
Muhammad Umar
thanks you find it useful.
Hi,
It was helpful. Appreciate your efforts.
Regards
Mohit Singla
Glad it helped you.
Dear Hrusikesh Dalai,
Thanks for such a simple and clear documentation.
regards
Ramesh
Thank You Ramesh
Hello Hrusikesh,
Thanks alot for sharing such a wonderful document.
Regards,
Lakshmi S
Thank You Lakshmi
Hello,
Thank you very much for sharing knowledge.
all the best Erwin
Hi Evin,
Thanks for rating it.
Hi Hrusikesh,
Nice article given in a simple manner. Would suggest if you can give it with a simulated scenario and provide the entries etc. to suit the scenario it would reach other in a better way.
Thanks for the effort.
Good Luck.
Thanks Ganesh This document is very generalise idea for beginners and those who wanted to understand Costing basics.
However i will try to come up with something as you suggested in future.
Good material
Thanks Krishna for rating it!!
Thanks a lot for that. I’ve just started working on the
CO-PC-ACT component and this information is very useful.
I am glad it is useful to you. thanks for reading it.
Hello Hrushikesh,
This is one of the superlative document by time. Excellent presentation. Thank you very much for sharing your exceptional knowledge on the forum and people who is really looking for learning product costing. This is something really easy and understanding.
I have request to you that can you please understand us the report KKS2 which is for “Calculation of Variance” in your variance analysis report.
Your help would be great for people here.
Regards,
Sharu.
Hi Hrushikesh,
That was great explanation and simple too! Thanks for sharing.
Would like to read something on “Project settlement to profitability segment” and explanation of related configurations.
Thanks,
Krishna Raj
Hi Hrushikesh,
Nice explanatory document, but C011N, it is the planned activity cost only right, but month end, we need to calculate actual activity and overhead rate and revaluation of the production order or PCC.
Regards,
Satya
Hi Hrushikesh,
Great show – much enlightened due to this article
Thanks & Regards
Krishnan
As clear as crystal, thaks a lot