The system calculates work in process to determine what costs were incurred for production orders that have not yet been settled. You can have the system calculate the work in process in the following ways:
This function is supported in period-end closing for the Product Cost by Order component as individual processing or collective processing.
This function is performed through the reconciliation ledger for all orders in the object class production. For more information, see the document Cost Element Accounting and Revenue Element Accounting.
In the Product Cost by Order component, you can calculate work in process for each order using two methods:
The work in process calculated by the system is passed on to Financial Accounting by period, where it is assigned to the following accounts:
Balance sheet |
Value of semifinished products |
Profit and loss statement |
Inventory changes |