Skip to Content
Author's profile photo Former Member

Primary Cost Component Split for Cost Estimation

Significance:

The primary cost component split is an alternative way of showing the cost of goods manufactured of a product. This cost component split assigns the primary cost elements for the cost center or process to the cost components, which enables you to see the composition of the price for the activity type or the costs for the process.

The primary costs from Overhead Cost Controlling can either be transferred directly into the primary cost component split of the product or assigned to other cost components. In this way, you can explode the costs for specific internal activities partly by their primary costs, and combine them partly as secondary costs.

Configuration is as follows.

1. Create Main Cost Component Structure in OKTZ.

/wp-content/uploads/2015/09/1_788224.png

2. Assign Cost elements to cost component structure: OKTZ

/wp-content/uploads/2015/09/2_788149.png

3. Creation of Auxiliary cost component structure: OKTZ

/wp-content/uploads/2015/09/3_788153.png

4.  Assignment of Cost elements to cost component Structure:

/wp-content/uploads/2015/09/5_788155.png

Note: Ensure that do not assign any 43 category cost elements in the above step. Assign only all primary cost elements.

5. Assignment of auxiliary cost component structure to Main cost component structure:

/wp-content/uploads/2015/09/6_788159.png

6. Active the main cost component structure as bellow.

/wp-content/uploads/2015/09/7_788160.png

7. Activation of Auxiliary cost component structure

/wp-content/uploads/2015/09/8_788161.png

8.  Assign the Auxiliary cost component structure in planning versions: OKEQ

9.PNG

9. Primary cost Planing for cost center in KP06:

    10.PNG

10. Activity Planing (Only Qty) in KP26:

11.PNG

11. Creation Of Splitting Structure: OKES

/wp-content/uploads/2015/09/12_788178.png

Assign Cost elements and Activity types in Splitting Strucuter

/wp-content/uploads/2015/09/13_788179.png

/wp-content/uploads/2015/09/14_788180.png

/wp-content/uploads/2015/09/15_788181.png

12. After This Configuration Run KSS4(Plan Cost Splitting) and KSPI(Plan Price Calculation)

Results:

CK11N : Standard Cost Estimation

Itemization Over view:

/wp-content/uploads/2015/09/16_788199.png

Cost component View: Maint Cost Component Structure:

Cost displyed in Rawmaterial and Activity type components.

/wp-content/uploads/2015/09/17_788200.png

Cost component View: Auxilary Cost Component Structure

/wp-content/uploads/2015/09/18_788223.png

Activity costs(Machine, Labor & Set up) Bifurcated in to primary cost components such as Salaries, rent and Depreciaion etc.

Regards,

Ram

Assigned tags

      18 Comments
      You must be Logged on to comment or reply to a post.
      Author's profile photo Pavan Kumar Arvapally
      Pavan Kumar Arvapally

      Good document.....

      Author's profile photo Krishnam Raju
      Krishnam Raju

      Hi

      Very good document .....

      Author's profile photo Rajneesh Saxena
      Rajneesh Saxena

      Hi Ramkrishna

      Super hit.

      I like the document and in fact I was wondering why this aspect has not been touched so far by any one of us? Great.

      May I ask why splitting step is touched here? Is that a mandatory step in this process?

      Regards

      Rajneesh Saxena

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you Rajneesh and Pavan,

      Splitting is mandatory if you use activty inedependent planing otherwise not required. In the example i have used activity independent planing hence i used splitting

      Author's profile photo Narasimhulu Konnipati
      Narasimhulu Konnipati

      Very nice document Ram....

      This will surely help many upcoming CO consultants.

      Keep up the good work.

      Thanks,

      NSK

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you NSK

      Author's profile photo Kamal Kumar SAP Consultant/Trainer
      Kamal Kumar SAP Consultant/Trainer

      Really very good doc to understand the concept...I have few points

      1. Can we not get the result within the main CCS?  In my view we can get it because here main CCS created like itemization view..so in auxiliary view again you breaking the cost at primary level which we can get in single view (Main CCS)

      2. If I am wrong please correct me

      But again a appreciate the concept explained here.

      Kamal

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Hi Kamal,

      Thank you

      In main CCS we cant get it. Since in main CCS we need to assign all cost elements(Which are the part of BOM and Routing)  to cost components. If you assign primary cost elements in main CCS we will get error for activity cost i.e 43 category cost elements.

      So here we need to use both Main CCS and Auxiliary CCS for primary cost component split

      Regards,

      Ram

      Author's profile photo Kamal Kumar SAP Consultant/Trainer
      Kamal Kumar SAP Consultant/Trainer

      Hi Ram

         No..you are not correct..If you assign both CE cat 43 for activity and related Primary CE in Main CCS it will break the 43 into primary and 43 cat will shown as 0 value by splitting into related primary CE...so separately you need not to define auxiliary CCS. I have done it in all my implementation because unnecessary user has to see 2 CCS report for break up.

         Kamal

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Hi Kamal,

      Thank you for correct me. I will try this time.. Thanks a lot.

      Author's profile photo Kamal Kumar SAP Consultant/Trainer
      Kamal Kumar SAP Consultant/Trainer

      It's all right..pl test it to remove any confusion...but post doc like this will help many ...

      Thanks

      Kamal

      Author's profile photo Former Member
      Former Member

      Hi, Could you please show how to realize primary cost component split without auxiliary CCS? I tried a lot of times, but still can not get correct result.

      Author's profile photo Mukthar Ali Ahamed N
      Mukthar Ali Ahamed N

      Hi Rama Krishna,

      Nice explanation...Thanks for sharing information

      Regards,

      Mukthar

      Author's profile photo Former Member
      Former Member
      Blog Post Author

      Thank you Ahamed.

      Author's profile photo surendra kotha
      surendra kotha

      Hi Ramakrishna,

      Very Good document... keep up doing the good work.... 🙂

      Author's profile photo Former Member
      Former Member

      Hi Ramakrishna,

      I have a question, the same customizing applied to Actual Cost (Material Ledger) ?

       

      Regards,

      José Luis

       

      Author's profile photo Former Member
      Former Member

      Pep Diola,

      The same question from me, and I am involved in a project with the exact solution in ML,

      Test it and not work

      if you have the same situation, email me gongxubao@hotmail.com, let's discuss in detail

      Author's profile photo Abdullah Tufail
      Abdullah Tufail

      Great Job.... Keep it up.

       

      Thank you, I was exactly looking for this for my client.