Variance Analysis 
Variance Analysis
Use
With the R/3 Standard function ‚variance analysis‘ you can split the variances of a production order by variance categories and save them separately (for example input price variance, input quantity variance).
You can analyze the determined variance amounts and transfer them separately to the profitability analysis at the settlement of the respective order (separated by variance categories), (see
Variances in the Profitability Analysis).Features
The variance analysis is also possible for AFS production orders to full extent. The system summarily determines the variance categories for all items of an AFS production order. That means, the system does not display variance amounts for individual order items (produced SKUs). The variance amounts always refer to the total quantity of an order.
On the other hand the variance determination considers the grid-/category-dependent quantity structure of the individual order items. The determined variance amounts are exact and are not based (with several produced SKUs per order) on planned-, target- and actual costs of one (default) grid value/category or an average. They are based on the costs of the actually produced SKUs.
Note the following AFS-specific feature:
The standard cost estimate of AFS materials is based on the grouping of SKUs to valuation types (see
Definition of Valuation Types). It is possible that several SKUs of the same product have the same standard price, although (individually costed) they have different costs because of their quantity structure.As the target cost determination in the production order (like the actual costs) is not based on valuation types, here each SKU is costed separately. Therefore it is possible that planned/target variances occur that are caused by the grouping to valuation types at the standard cost estimate. The system displays these variances as ‚remaining input variance‘ of the variance category.
Therefore you should try to combine only these SKUs to valuation types that almost have the same planned costs.
The sizes XXL and XL are combined to one valuation type (X). XL is the preference SKU. The standard cost estimate for one piece XL is 11. This results in a standard price of 11 for the valuation type X.
The actual planned costs for a piece XXL are 12 because of the higher material consumption. The target cost determination for a production order with one piece XXL is then 12 as well. At the goods receipt the order is debited with 11, because XXL has the same standard price of 11 as XL (because of the common standard cost estimate).
That causes remaining input variances of 1 for the order.