Planned Costs for Materials Manufactured In-House 
If a material is manufactured in-house, the system calculates the planned costs of the material using the valuation variant and a price stored in the material master record.
In Customizing, a costing variant is defined for each order type and plant. The costing variant refers to a valuation variant which determines which price from the material master record is used to calculate the planned costs of a material (for example, the moving average price or the standard price).