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Function documentation Purpose of Product Cost Planning 

Use

You can use Product Cost Planning to do the following:

·  Calculate the non-order-related cost of goods manufactured and cost of goods sold for each product unit

·  Establish how the costs are broken down for each product, and to calculate the value added for each step of the production process (Concept of Cost Rollup)

·  Optimize the cost of goods manufactured through comparison costing ( Product Cost Controlling Information System)

·  Provide basic information for other SAP applications, such as:

¡  Standards with which to assess production efficiency in Cost Object Controlling

¡  Prices that are updated in the material master record and Profitability analysis

¡  Lower price limits for Sales and Distribution

Features

The following graphic illustrates the aims of Product Cost Planning, which are:

...

  1.  Calculation of the cost of goods manufactured (COGM) and the cost of goods sold (COGS) of a product

  2.  Analysis of the costing results using the various reports available

  3.  Provision of information for other SAP applications

This graphic is explained in the accompanying text

The following table describes the reports with which you can analyze the costing results:

Report

Contents

Cost component split

A view of the costs of a material cost estimate broken down into cost groups, such as material costs, production costs, and overhead costs.

Itemization

Detailed information about the costs contained in a material cost estimate or base object cost estimate

Itemization by cost element

Detailed information about the costs contained in a material cost estimate or base object cost estimate, sorted by cost element

Costed multilevel BOM

Quick overview of the BOM and costs of a material cost estimate or base object cost estimate in hierarchical form

Partner cost component split

Overview of the value added portions of organizational units (partners) in relation to the total costs of a material

You can use the Product Cost Controlling Information System (CO-PC-IS) to analyze the costing results. The following table gives you an overview of the various analysis options in the Information System:

Information about Material Cost Estimates

Detailed reports:

·  Cost component reports

·  Itemization

·  Costed multilevel BOMs

·  Partner cost component splits

 

Comparative reports:

·  Product cost estimate vs. preliminary cost estimate

·  Cost component comparison

·  Cost element comparison

·  Itemization comparison

 

Analyzing the costing run:

·  Results of the costing run

·  Price vs. cost estimate

·  Variances between costing runs

 

 

Information about Base Planning Objects

Detailed reports:

Multilevel Explosion of Base Planning Objects

Costed multilevel BOMs

Itemizations

 

Comparative reports

Object Comparison for Unit Costing

 

 

 

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