Standard cost estimate are created at the beginning ofa fiscal year or a new season. The standard cost estimate is thenvalid for the entire year or season. It is used to determine a standardprice for materials in this period.
The standard cost estimate will write the results of thecost estimate into the costing details screen of the material master recordas the future standard price once it is marked. This price is thenactive for internal material valuation. For example, it can be usedto valuate a material components in the cost estimate.
Once the cost estimate is released, the system transfersthe result of the standard cost estimate into the material master recordof the material as the standard price. This price is then activefor Financial Accounting and is used for valuation of the material untilthe next time a standard cost estimate is released.
In this period, all transactions involving products producedin-house in the Logistics module are valuated using the results of thestandard cost estimate. If a material with standard price controlis delivered to stock, for example, inventories of this material are valuatedwith the standard price determined by the standard cost estimate.
The standard prices calculated in the standard cost estimateapplies only for materials with S price control.
Cost Estimate with Quantitative Structure
The cost estimate is a tool for establishing prices formaterials. It is used to calculate the costs of goods manufacturedand the costs of goods sold for each product unit.
In order to establish the cost estimate with quantitystructure of a material, the bills of materials and routing of the materialmust exists for the materials to be costed.
The cost estimate with quantity structure uses the materialmaster data to determine the material consumption and internal activitiesrequired to produce the product.
Costing calculates the cost of goods manufactured foreach material made in-house in the BOM structure.
The materials in a BOM are called BOM components, thesecan consist of a material without its own BOM (material components), ora material with its own BOM (assembly). If the product has a multilevelBOM, then the costs for the material components are calculated and takeninto account when the next highest assembly is costed. The structureof the BOM determines the sequence in which the materials are costed.The BOM components with the largest low-level code (that is, the materialcomponents) are costed first, then the BOM components with the next low-levelcode and so on.
Costing can also determine the cost of goods manufacturedfor materials produced in another plant if the two plants are assignedto the same controlling area and the company codes of the plants use thesame cost component structure. In this case, the structure of thecost component split must be the same in both plants.
For raw materials, the system determines the procurementprice using the entry in the material master record. A cost componentsplit is created automatically for the material costs. You can addmanually entered costs to the material costs by means of an additive costestimate that contains separate cost components. This enables youto include such costs as freight charges and insurance costs with raw materialsor stock transfer costs with semi-finished products. Other reasonsfor adding manually entered costs to the material cost estimate includemissing routings or BOM components.
Normally, a multi-level production structure is costedusing costing with a quantity structure. The costs are rolled upautomatically using the low-level codes.
- The materials in the low-level code with the largest number(such as raw materials) are costed and the costs are assigned to cost components.
- The materials in the next highest low-level code (such assemi-finished materials) are costed. The costs for the materialscosted first are rolled up and become part of the material costs of thenext highest level.
Creating a cost estimate for a single material andits child parts with quantitative structure
Procedure
- Transaction CK11
- Enter PPC1 (standard SAP variant - configuration transactionOKKN) as the costing variant, material and plant. If you do not entera lot size, the system uses the costing lot size from the costing viewof the material master record.
- Hit Enter
- The dialog box: Control Data appears
- Check the proposed costing dates in the dialog box and thetransfer control ID. The transfer control would determine whetherthe cost estimates of the child parts supplied by other plants are to berecomputed or taken as its is without recomputation. Use TransferControl PC01 which would recompute.
- Press Enter and the system will costs the material.
- The system creates and valuates the quantity structure andcalculates overhead. You can analyze and display the costing results.
- After carrying out costing with quantity structure, you cansee the costing results for the header material (the highest material)in the BOM.
- Choose the desired view with costs -> disp.Cost components.
- Click Save (Note the standard cost is still NOT updated yetat this point.
- Transaction CK20
- Enter the Material, plant, future posting period and fiscalyear. This period indicates the "from" date.
- Click Save (Marking of standard cost estimate is being updated)is displayed.
- The results of the standard cost estimate are updated asthe futured standard price in the material master (accounting and costingview). Note that marking does not affect the material stock valueyet.
- Transaction CK21
- Enter the Material and Valuation Area.
- Click Save
- The corresponding future standard prices are updated as thecurrent standard prices in the material master. How often you releasea standard cost estimate depends on its planned validity period.If stocks of materials exist, the stock value changes and a document iscreated in Financial Accounting documenting the price change.
- The system post to the inventory account with offsettingentry posted to the price difference account.
- CK41 - Create costing run
- Some Material
- CK43/CK60 - Selection of materialsand display results of selection
- CK62 - Explode BOM
- goto Continue
- All Material
- CK43/CK60 - Material field left blankand display results of selection
- goto Continue
- Continue
- CK42 - Select the low-level code withthe highest number
- CK64 - Perform costing run for thatlow-level code
- CK66 - Mark and review the results
Before this step you have to finishedthe step for either Some Material or All Material.
- After getting approval for costingresults from costing controller, you can finally post the cost estimate
- CK68 - Release of standard cost estimate- Repeat the process for the next low-level code for AllMaterial
- If Error
- CKR1 - Delete cost estimate and startagain.
- CKR1 - Delete cost estimate
- Make necessary changes to BOM, material routing etc.
- CK41 - Create costing run
- Repeat process start
- CK43/CK60 - Selection of materials and display result ofselection
- CK62 - Explode BOM
- CK42 - Select the low-level code with the highest number
- CK64 - Perform costing run for that low-level code
- CK66 - Mark and review the results
- Get approval for costing results from the costing controller
- CK68 - Release of standard cost estimate
- Repeat the process for the next low-level code (goto Repeatprocess start)
- CK11 - Perform single material cost estimate
- CK20 - Mark and review results
- CK21 - Release of standard cost estimate
Costing run is used to process mass data. The costingrun enables you to cost more than one material at the same time, eitheronline or in the background. It reproduces the entire process ofcosting with a quantity structure.
Process Flow Overview
Create costing run
- Company code
- Posting parameters
- Costing variants
- Costing dates
Select specific assemblies forthe costing run
Quantity structure determinationfor the selected assemblies
All materials
Select all assemblies for the costingrun
After completing the steps for eitherSome material or All materials
Carry out costing run
Mark and release costing
The costing run involves separate steps, being the selectionof materials for costing, determining material components via the BOM explosion,and then carrying out costing level by level.
BOM explosion is only necessary if a complete selectionof materials is not carried out, such as the selection of finished productsonly.
Logs are generated for each step of the costing run, andcan be printed out and saved in the system. With Extras you can printthe logs for selection and quantity structure determination, for costingand for marking and release (online or background mode).
Creating a costing run
Procedure
- Transaction CK41
- Enter a name identifying the costing run (i.e. test x andthe (i.e. XX.XX.XX) on which the costing run is to be executed.
- Press Enter. This brings you to the general data forthe costing run.
- Enter the necessary data and press Enter.
- The dialog box Costing Dates appears.
- Check the proposed data's and make any necessary changes.Press Enter. The release is only possible within this period messageis displayed. Press Enter.
- If costing across company codes has been activated in theCustomizing for Product Cost Planning, the system displays the controllingarea in which existing cost estimates from other company codes can be transferred.
- Specify the Update Parameters.
- Press Enter.
- Specify the Print Parameters.
- Press Enter and Save the costing run.
Procedure
- Transaction CK60
- Goto -> Variants -> Get. Select the variant name.
- Enter a range of material numbers and plant. If thematerials selected come from different plants, leave the plant field blank.
- As a default value, the last costing run entered and itsdata are displayed. You can change both as needed.
- Click the Copy button.
- To start the selection, choose Execute. The releaseis only possible message is displayed. Press Enter.
- After the selection, a list screen appears with informationon the costing run and data on each material selected.
- To check all messages that occurred during selection, chooseExtras -> Log
- Save the costing run.
Procedure
- Transaction CK43
- Enter the name and date of the costing run and press Enter.
- Before carrying out any further steps, choose Extras -> Log-> For Selection. The log provides an overview of the results ofthe selection and the option to correct possible errors before carryingout further steps.
- Choose the desired view with Goto.
- For example: Goto -> Material Overview.
Procedure
- Transaction CK62
- Enter the name and date of the costing run.
- Choose Execute.
- The release is only possible message is displayed.Press Enter.
- Choose Settings -> Field selection to obtain further informationon this overview.
- The dialog box List Field Selection appears. You canspecify that
- information on special procurement is displayed
- information on the BOM is displayed
- the status of the selection is displayed
- the number of messages is displayed
- Choose Edit -> Sort to sort the list either by low-levelcode of by material number. To view the system messages that wereissued during the BOM explosion, choose Extras -> Log.
- To save the materials selected under this costing run, chooseCosting run -> Save.
Procedure
- Transaction CK42
- Enter the name and date of the costing run and press Enter
- Choose Goto -> Low-level code overview. The releaseis only possible message within this period is displayed. Press Enter.This would set the materials in the "low-level code" order.
- Mark the low-level codes or materials and choose For costing.(**Remember that the lower low-level codes that is, the low-level codeswith the highest numbers must be costed first.)
- The system will display the number of low-level code(s) selectedfor cost estimate. Press Enter.
- Save the costing run.
- Perform transaction CK64 to execute costing run containsthat low-level code. Then save the costing run.
- Perform transaction CK66 to mark the costing contains thatlow-level code. Review the results and save.
- Perform transaction CK68 to release the costing run containsthat low-level code.
- Repeat the process from step 2 to 9 for the next higher numberof low-level code.
Procedure
- Transaction CK64
- Enter the name and date of the costing run.
- Choose Execute. Release is only possible within thisperiod is displayed. Press Enter.
- When the costing run is finished, you come to the overviewof the low-level codes.
- Select Materials and choose Goto -> Detail screen.
- The system displays the costs for the material as cost ofgoods manufactured, cost of goods sold, inventory costs and so on.
- For detailed information on the costs, choose Costs -> Displaycost components or Itemization or Cost element itemization or Costed BOM.
- The system displays the costs for the material as cost ofgoods manufactured, cost of goods sold, inventory costs and so on.
- For detailed information on the costs, choose Costs @ Displaycost components or Itemization or Cost element itemization or Costed BOM.
- Costing run -> Save.
Procedure
- Transaction CK66
- Enter the name and date of the costing run.
- Choose Execute. The release is only possible messageis displayed. Press Enter.
- Choose Execute. The release is only possible messageis displayed. Press Enter.
- Check the prices and save.
Procedure
- Transaction CK68
- Enter the name and date of the costing run.
- Choose Execute.
- Costing run -> Save.
- The results of the standard cost estimate are updated inthe material master record as the current standard price. At thistime, the stock value of the material is changed and the new standard pricefor valuating material movements is active.
- Make sure the status is FR for all. If not, call theconsultant.
Procedure
- Transaction CKR1
- Enter a company code, plant, material number, costing variant,costing version, Interval for validity form and Interval for validity toor overwrite them.
- Select the Current std cost estimates.
- Specify whether the deletion should be simulated (Test run)or actually carried out (Reorganization). Set the With log indicatorif desired.
- Choose Execute.
- Save. The system issues a message indicating the numberof cost estimates deleted.
The costing status provides the following information:
- informs you about the current processing status of the costestimate
- informs you about errors in the cost estimate
- prevents incorrect data from being passed on
- prevents a cost estimate from being released again
The following costing status can be set by the system:
StatusMeaning
- EROpened
- SESelected without errors
- SFSelected with errors
- KACosted without errors
- KFCosted with erros
- VOMarked without errors
- VFReleased with errors
- FRReleased without errors
- FFReleased with errors
- FMRelease through material ledger closing
SAP Controlling
