Cost Elements 
Items that are relevant to costing are assigned to a cost element. For example, material costs (category M) are assigned to primary cost elements, while production costs (category E) and overhead costs (category G, P, or X) are assigned to secondary cost elements.
Note
Item categories T (text) and O (formulas) in unit costing (that is, material costing without quantity structure and base planning objects) are not relevant to costing and therefore do not need to be assigned to cost elements.
Features
Cost elements are determined by the system based on the following data:
Item Category | Cost Element Determined Based On |
|---|---|
M (materials) | Valuation class in the accounting view of the material master record |
E (internal activities) | Master data of the activity type |
X and P (business processes) | Master data of the business process |
G (overhead) | Credit key in the costing sheet |
V (variable items) | Your manual entry
Variable items are only available in unit costing. End of the note. |
F (externally processed operations) | Entry in the detail screen of the operation |
More Information
For more information about cost elements, see the document CO Cost Center Accounting.