You have entered the costing method unit costing in Customizing for Product Cost by Sales Order in the requirements class.

If you don’t enter a default costing method in the requirements class, you can choose the costing method in the sales order.

You use unit costing in the following situations:

• When there are no BOMs or routings

• When you want to simulate the results of different production scenarios

How you use unit costing in sales-order-related production depends on whether the materials to be delivered or the services to be provided are standard or nonstandard.

Nonstandard materials and services are of a one-off nature.

You create a cost estimate that contains the following data:

• The materials to be used and the required quantities

• The activity quantities, cost centers, and activity types for the internal activities

• Quantities and prices for the external activities

• Process costs

Using the valuation variant specified in the costing variant, the system finds the material price valid on the pricing date for each material, and the activity price valid on the pricing date for each activity type. The system then calculates the overhead on the basis of the direct costs.

Standard materials and services are used frequently.

You create a base planning object for these groups of costing items. When you cost a sales order, you can:

• Use your base object cost estimate as a reference to copy costing items from the base object cost estimate into the sales order cost estimate

• Or use several base object cost estimates as items within the cost estimate

You can list all the costing items contained in the base object cost estimates with the Explode base object function.

The function Explode material allows you to copy material cost estimates for the semifinished products listed in the unit cost estimate into the unit cost estimate and modify them if necessary.

No cost component split is saved for unit cost estimates. If the standard price is based on a unit cost estimate, the system cannot transfer a cost component split to CO-PA.