Setting Up Valuation Using Actual Cost Estimates from Material L (SAP Library

Setting Up Valuation Using Actual Cost Estimates from Material Ledger

Use

In Profitability Analysis, not only can you valuate your sales quantities using a standard price determined with a standard cost estimate, but you can also valuate them using actual cost estimates from Material Ledger. You can copy the actual cost estimate either as a single total as the average transfer price or in detail as the actual cost component split. Valuation using actual cost estimates occurs periodically after period-end closing has been performed in Material Ledger, thereby determining the actual cost estimate.

In the information system in Profitability Analysis, you can compare the COGM cost components for the standard cost estimate with those for the actual cost estimate. This allows you to analyze where any variances have occurred.

Note

The following section describes the procedure that you follow if you set up valuation using actual cost estimates retrospectively. This is the case, for example, if the application component Actual Costing/Material Ledger is installed after Profitability Analysis.

Prerequisites

Valuation using material cost estimates (for a standard cost estimate) should be set up in Customizing for Profitability Analysis (under Master Data ® Valuation ® Set Up Valuation Using Material Cost Estimates).

The application component Actual Costing/Material Ledger is activated for the relevant Valuation Areas (in Customizing under Controlling ® Product Cost Controlling ® Actual Costing/Material Ledger ® Activate Valuation Areas for Material Ledger).

Actual costing is activated for the relevant valuation areas (in Customizing for Actual Costing/Material Ledger under Actual Costing ® Activate Actual Costing).

If you want to copy the actual cost estimate in detail to be used as the actual cost component split, the actual cost component split must be activated for the relevant valuation areas (in Customizing for Actual Costing/Material Ledger under Actual Costing ® Activate Actual Costing).

Procedure

Decide how you would like the actual costing values to be copied and displayed. You have the following options:

You can copy the actual cost estimate as a total (just periodic transfer price) or in detail (periodic transfer price and actual cost component split).

You can overwrite the standard cost estimate with the actual cost estimate or you can create your own value fields for the actual cost estimate (in Customizing for Profitability Analysis under Structures ® Maintain Value Fields).

These two options can also be applied together. If you copy the actual cost estimate in detail, you can place the periodic transfer price, for example, in a value field of its own, while overwriting the standard cost estimate values with the actual cost component split.

If you copy the actual costs in detail and want to place all values into new value fields, you need to create the following value fields:

A value field for the periodic transfer price
An extra value field for each of the individual cost components (as with the value fields for the standard cost estimates)

If you have created new value fields, include them in the operating concern and then activate the operating concern (in Customizing for Profitability Analysis under Structures ® Maintain Operating Concern).

Create a valuation strategy for valuation using actual cost estimates and activate the Material Cost Estimate indicator. Assign this valuation strategy to point of valuation 02 (Periodic Revaluation).

Define a costing key for the actual cost estimate (in Customizing for Profitability Analysis under Master Data ® Valuation ® Set Up Valuation Using Material Cost Estimate ® Define Access to Actual Costing/Material Ledger). In the costing key, assign the periodic transfer price to the corresponding value field.

Assign the costing key for point of valuation 02 to a product, a material type or - using flexible access - to any combination of CO-PA characteristics (using the corresponding activities in Customizing for Profitability Analysis under Master Data ® Valuation ® Set Up Valuation Using Material Cost Estimate).

If you want to copy the actual cost component split in detail, assign the individual cost components to the corresponding value fields (in Customizing for Profitability Analysis under Master Data ® Valuation ® Set Up Valuation Using Material Cost Estimate ® Assign Value Fields)

If required, define a profitability report with which to compare the value fields from the standard cost estimate with those from the actual cost estimate.

Result

Once the costing run for periodic actual costing has been run in Material Ledger (see Process Flow: Periodic Actual Costing), you can copy the actual cost estimate using periodic valuation for Profitability Analysis (see Periodic Valuation of Actual Data).