PRODUCT COSTING END USE MANUAL

Submitted to

WME

By

HP
List of symbols used

Product Cost Planning, Costing Run

Purpose
Product Cost Planning is used to plan costs and to price materials. It determines the cost of goods
manufactured (COGM) and cost of sales (COS) for each product unit.

Material cost estimates can be created at various times during a fiscal year.

• At the start of a fiscal year or accounting period

• During the fiscal year
• Before preparing the financial statements
Process flow

 Checking material master records

 Checking the Bill of Materials
 Checking Routing
 Processing the costing run.

Data used during the process

Field Data
Material S200001
Company Code 8100
Plant 8100
Costing Variant Z810
Check the material master record
1. Call up the transactions as follows

2. Enter the following data

Field Data
Material S200001
3. Choose select view(s)
4. In the Select View(s) dialog box, enter the following data:

Field Data
MRP2 Select
Accounting 1 Select
Costing 1 Select

5. Click on choose button

6. In the organizational levels dialog box enter the following data.

Field Data
Plant 8100
7. Check the following entries on the accounting 1 tab

Field Data
Valuation class 8100
Price control S (for standard price)
8. Choose the Cost Estimate 1 tab

Field Data
With qty structure Select
Material origin Select

9. Click on enter
10. In the last data screen reached dialog box, choose yes
Checking the bills of material
1. Call up the transaction as follows
2. Enter the following data

Field Data
Material S200001
Plant 8100
BOM usage 1

3. Enter

4. On the display material BOM: general item overview screen, Choose Header

5. Click on close

6. Choose

7. Choose
8. Select Status/Lng Text tab

9. Choose to check up to the last item

10. Choose until the over view tree appears.

Checking the routing
1. Call up the transaction as follows

Transaction Code: CA03

Path

2. Enter the following data:

Field Data
Material S200001
Plant 8100
3. Click on Enter

4. Choose
5. Check the following entry:

Field Data
Status 4
6. Choose

7. Choose
8. Choose Details --- Operations

9. In the Display Routing: Operation Details screen check in the General data fields using the (Next
operation) until you have reached the last operation.

10. Choose until the over view tree appears.

Processing the costing run
Use
You process a costing run through the flow steps Create costing run, Selection of materials, Structure
explosion, Costing, Analysis, Marking and Release.

Procedure
1. Call up the transactions as follows

2. Choose
3. In the create costing run screen, enter the following data:

Field Data
Costing run, 1. field Name of the costing run (user-defined)
Costing run, 2. field Name of the costing run (user-defined)
Costing run date Today`s date
Costing variant Z810
Costing version 01
Company code 8100

4. Choose and
5. In the create cost estimate section choose Selection

6. Enter the following data

Field Data
Material S200001
Plant 8100
Background processing Deselect
7. Choose

8. Choose

9. In the Create cost estimate section choose selection under execute choose ->
10. Click on
11. A green traffic light appears in the selection line under status 1 material have been determined
which did not contain any errors.
12. In the create cost estimate section choose Structure explosion 

13. Enter the following data

Field Data
Background processing Deselect

14. Choose

15. Choose

16. In the Create cost estimate section choose structure explosion ->

17. Click on
18. A green traffic light appears in the structure explosion line under status 3 material have been
determined which did not contain any errors.

19. In the create cost estimate section choose costing 

20. Enter the following data

Field Data
Background processing Deselect
21. Choose

22. Choose

23. In the Create cost estimate section choose costing ->

24. Click on
25. A green traffic light appears in the Costing line under Status. 3 materials are costed, none of which
contains errors. All of the related costing is carried out.

26. In the costing results section click on

27. Screen appears as below and click on material overview button

28. Screen appears as below

29. Select the line for material S200001 and choose → Multilevel BOM. You will see the costing
structure
30. Choose

31. Select the line for the material and choose → Cost comps. You will see the cost components of
the material
The below screen appears

32. Choose
33. For analyzing the results of costing run

Allow Marking
Marking can only be allowed once in a given period. Providing no release has yet occurred
you can reset the marking allowance. However, you should note this cancels all marked
prices.
If marking is not yet allowed (locked padlock symbol) continue with below step
34. In the section create cost estimate choose marking 

35. Select the line for company code 8100.

36. Double click on 8100 company code line item then a permitted standard cost estimate variant dialog
box appears, enter the following data.

Field Data
Costing variant Z810
Costing version 01
37. Choose
The system conforms that marking allowance has been issued.
You can repeat the marking as often as required, until the standard costing has been released.

38. If marking is already allowed (the padlock looks like this ), reset it as set out below:

39. In the section create cost estimate choose Marking 

40. Select the line company code 8100.

41. Chooes

42. Choose
43. Again continue from step 39.
44. In the create cost estimate section choose Marking 

45. In the price update: Mark standard price screen, enter the following data

Field Data
Background processing Deselect
Test Run Deselect

Note: first enable the test run and do the below process if no logs were occurred then disable the test
run and do the below process.

46. Choose

47. Choose
48. In the Create cost estimate section choose Marking ->

49. Click on the below screen appears

50. Choose
51. A green traffic light appears in the Marking line under Status. 3 materials are marked, none of which
contains errors.

The standard cost estimate of a material can only be released once in a given period.
52. In the create cost estimate section choose Release 
53. Enter the following data

Field Data
Background processing Deselect
Test Run Deselect

By selecting Test run, you ensure that the system only simulates the release of the standard cost
estimate. If you do not select this field, the costed price is entered in the material master under the
Costing 2 view.

54. Choose

55. Choose

56. In the Create cost estimate section choose Release ->

The below screen appears

57. Choose until the overview appears.

58. Go to material master MM03 and check the accounting 1 tab standard price Colum.
Product cost by order
Purpose

During order-related production, Cost Object Controlling can provide you with information about a
production order that settles its costs to inventory.

Process flow

 Opening a production order

 Display the cost analysis of a production order
 Processing the goods issue for the production order
 Conforming the production order
 Calculating the actual oh for a production order
 Calculating WIP
 Calculating and explaining variances
 Settling the production order

Data used during the process

Field Data Description

Plant 8100 Welspun Middle East Pipes LLC
Material S200001 S 0535x05.00 IS3589 Fe410 BARE PIPE
Controlling Area 8100 Welspun Middle East
Opening the production order
1. Call up the transaction as follows

2. Enter the following data

Field Data
Material S200001
Production Plant 8100
Order type PP01
3. Choose
4. Enter the following data

Field Data
Total Quantity 10
Dates/start Today’s date
Scheduling/type Current data
5. Choose
The release is executed
6. Choose
7. Make a note of the production order number

8. Choose until the overview tree appears

Displaying the cost analysis of a
production order
1. Call up the transaction as follows
 If the set controlling area dialogue box appears, enter the following data:

Field Data
Controlling Area 8100

2. Choose
3. Enter the following data

Field Data
Order Your production order number (predefined) Ex. 1000085
4. Choose

5. Select layout 1SAP02 (double click)

6. Choose
The cost development screen appears

If you want to display different data, select a different layout.

7. Choose until the overview tree appears.
Processing the goods issue for the
production order
1. Call up the transaction as follows
2. Choose To order button

3. In the Reference: Order dialogue box, enter the number of your production order, then choose
4. On the enter goods issue: selection screen, select all materials that are to be issued for this order. To
ensure that a variance is generated by the goods issue posting. Enter a withdrawal of 1 ton for
material component S100101 instead of 0.663 ton

Input the name of the

goods recipient

5. Choose Adopt + Details

6. On the Enter Goods Issue: New item XXXX screen. for each of the selected materials and enter the
following data

Field Data
Batch Mani
Stor.loc. 1100

7. Choose

8. Choose
 Conform any warnings that may appear.

If the system displays any error messages, check the quantity of the material that you have in stock and
change the quantity to be withdrawn accordingly.

To analyze the cost of this production order, follow the steps under display the cost analysis of
production order.

9. Make a note of the document number.

10. Choose until the overview tree appears.

Display of accounting documents
1. Call up the transaction as follows

Menu Path Sap menu Logistics Logistics Execution Inbound process Goods Receipt for
purchase Order, Order, Other transactions MIGO – Enter Goods Receipt for
Purchase Order.
Transaction Code MIGO

2. Choose and enter the following data.

Field Data
Select Display
Select Material Document
Document number 4900456199
3. Choose and click on Doc.info tab

4. Choose FI Documents

5. In the List of Documents in Accounting dialogue box choose Accounting document

A document overview – Display screen appears

6. Choose
7. Choose Profit center doc.

Profit center: Actual line items screen appears

8. Choose
9. Choose controlling document

10. Display actual cost documents screen appears

11. Choose until the overview tree appears.

Conforming the Production Order
1. Call up the transaction as follows

Menu Path Sap menu Logistics Production Capacity Planning  Requirements 

Production Order Conformation Enter For Operation CO11N- Time Ticket.
Transaction Code CO11N

2. Enter the following data and choose Enter

Field Data
Order Number of your production Order (1000085)
Oper./activity 0010
Yield 10
3. Choose
4. Confirm all the operations by using above process.
5. Choose until the overview tree appears.
Calculating WIP
Use

Before you determine the variances, you need to establish how much there still is. Hence you first
calculate the work in progress.

Procedure

1. Call up the transaction as follows:

2. Enter the following data

Field Data
Order Number of your production Order (1000085)
WIP to period Current period
Fiscal year Current year
RA Version Select
RA Version 0
Test Run Deselect
Save Log Select
3. Choose

4. Choose until the overview tree appears.

Calculating and explaining the variances.
1. Call up the transaction as follows
2. Enter the following data

Field Data
Order Number of your production Order (1000085)
Period Current period
Fiscal year Current year
All target cost vsns Select
Test Run Deselect
Detail List Select
3. Choose
The Variance Calculation: List screen appears

4. Choose
5. Select variance categories in the dialogue box Choose layout

6. Choose
7. The variance calculation list screen appears
8. Choose Cost elements

The below screen appears and choose the cost element and click on Variances
9. Variance calculation: Explanation screen appears, this screen contains a definition of types of
variances, as well as explaining how they are calculated.

10. You can also check the other entries in the list in the same way.
It is possible to repeat the variance calculation as often as required. If you do this, select
test run.

11. Choose until the overview tree appears.

Settling the production order
1. Call up the transaction as follows
2. Enter the following

Field Data
Order Number of your production Order (1000085)
Settlement Period Current period
Fiscal year Current year
Processing type Automatic
Test Run Deselect
3. Choose
You receive basic list for the actual settlement and choose

4. Actual settlement: order detail list screen appears and choose Accounting documents
5. A dialogue box list of document in Accounting appears

6. in the dialogue box choose accounting document, the below Document Overview – Display screen
appears

7. Do the same process for the remaining documents.

8. Choose till the overview screen appears.