Overhead costs are costs which can only indirectly be attributed to the product, such as electricity or general storage costs. You can allocate these overhead costs in the following ways:
In the conventional method, overhead is applied to the reference object as a percentage or quantity-based rate. The overhead is applied by means of costing sheets.
Here, cost drivers are used to assign overhead to the reference object on a source-related basis according to usage. The overhead is applied by means of templates. Sender objects can be business processes or cost centers/activity types.
Assigning process costs to routing operations is particularly suitable for direct production processes. On the other hand, indirect processes should be assigned using templates.
Overhead is assigned from Financial Accounting (FI) to the cost centers in Cost Center Accounting (CO-OM-CCA). If you use Activity-Based Costing (CO-OM-ABC), overhead is passed on from Cost Center Accounting to the business processes of Activity-Based Costing.
The overhead costs are in turn passed on from Cost Center Accounting or Activity-Based Costing to Product Cost Controlling (CO-PC).
You can transfer the costs from Cost Object Controlling to the following:
· Financial Accounting (FI), to valuate finished and unfinished products, for example
· Profit Center Accounting (EC-PCA)
· Profitability Analysis (CO-PA)
· Material Ledger/Actual Costing (CO-PC-ACT)
You can pass on overhead costs that have not been applied to a cost object (such as sales and marketing costs) directly from Cost Center Accounting or from Activity-Based Costing to Profitability Analysis.
You can calculate both planned and actual overhead. You can also apply overhead to process costs. You can use overhead calculation for all the cost objects in the system.
You can calculate planned overhead costs in the following:
· Product Cost Planning (non-order-related material costing)
· Preliminary costing of manufacturing orders (production orders and process orders), and product cost collectors
· Sales order cost estimates
· Order BOM cost estimates
· Calculation of planned costs for general cost objects
· Preliminary costing for internal orders
You can calculate actual overhead costs at period-end closing in Cost Object Controlling based on the actual costs or quantities incurred thus far.
For more information about calculating overhead in manufacturing orders, product cost collectors, general cost objects, and sales order items see the following sections:
For more information about calculating overhead costs, see the following sections in the SAP Library: