Inventory Valuation 

Use

The R/3 System allows you to valuate stocks of a material either together or separately, that is, according to different valuation criteria. Split valuation is necessary if, for example:

Integration

The way the stocks of a material are valuated depends on how you define the following:

This defines whether the stocks are valuated jointly or separately. If stocks are to be managed separately, it also specifies the criteria used to valuate the stocks, that is, whether they are valuated by origin, in-house production/external procurement, or individual batches.

This is a further subdivision of the valuation category. For example, if the valuation category is origin, a company may want to define the valuation types stock from Los Angeles and stock from Detroit.

This data is stored in the material master record.

Prerequisites

Your system administrator has defined whether valuation at your company is at company code level or plant level and whether split valuation is allowed. For more information see Accounting.

Activities

Joint Valuation

If you want to valuate all stocks of a material at the same price, you specify neither a valuation category nor a valuation type.

Split Valuation

If you want to valuate stocks of a material separately, you must create a material master record with the appropriate valuation category. This record is called the valuation header record. Each material always has only one such record for each company code or plant (depending on whether the material is valuated at company code level or plant level).

Once you have specified the valuation category, you can create a material master record for each quantity of the material you want to valuate separately, with the appropriate valuation type and accounting data.