You use additive costing to manually add costs that cannot be calculated by the system to a material cost estimate. Examples of such costs are freight charges, insurance costs, stock transfer costs, incomplete BOMs, and routings.

You can create an additive cost estimate for these costs, which are then included in the automatic cost estimate for the material.

To ensure that the additive costs are included, set the indicator Incl. additive costs for each valuation strategy in the valuation variant in Customizing.

Through the costing variant in Customizing for Product Cost Planning, you specify the following:

• Whether any existing additive costs are to be included in cost estimates that you create with this costing variant
• Whether the additive costs are to be included when calculating overhead
• Whether the additive costs are to be included when transferring stock to another plant

You create cost components in Customizing for Product Cost Planning if you want to include the following costs in the cost estimate:

• Special direct costs of production
• Costs for materials for which no BOM has yet been created
• Costs for work sequences for which no routing has yet been created

For more information about creating costing variants and valuation variants, as well as updating additive costs in cost components, see the Implementation Guide for Product Cost Controlling.

The costs of a material are normally calculated using the quantity structure as a base. This type of cost estimate is performed automatically by the system. However, you can also manually enter estimated values for costs that cannot be calculated by the system. This allows you to add costs to a cost estimate that was calculated automatically.

The following figure shows the link between the automatic cost estimate and the additive cost estimate. The costs in the automatic cost estimate and the additive cost estimate are added together for each cost component, provided that both cost estimates have the same costing variant and costing version.

When you cost materials, the system determines the input quantity from the BOM for the material, and selects a price from the material master record through the valuation variant. If you set the Incl. additive costs indicator in the valuation variant, the system looks for existing additive cost estimates for the material and adds the manually-entered costs to the costs calculated automatically. The system adds the manually-entered costs to the costs calculated automatically.

If you enter or change costs manually for a material with a BOM, these costs are not automatically rolled up in the BOM structure. You must first either create a new material cost estimate or execute a new costing run, so that the changes are included and rolled up. If manually-entered costs were included, the system sets the Additive costing exists indicator in the overview screen of the cost estimate.

For raw materials, you can change the price in the material master record by entering an additive cost estimate, recosting the raw material automatically (Valuation and costing variants including additive costs), and releasing the result.

For assemblies, you can change the price in the material master record by creating an additive cost estimate, costing again with an automatic cost estimate (costing variant including additive costs, valuation variant as required), and releasing this price.

Additive cost estimates whose dates are not within the period of validity of the automatic cost estimate cannot be included in that automatic cost estimate.

Unit costing is a type of spreadsheet that, due to its integration, can use existing master data and prices in the R/3 system. When you create additive costs using unit costing, you can use the items of an existing additive cost estimate as a reference.