Day class - 18

Activity Based Costing

A when we can suggest ABC costing like when material cost less than Activity Cost
Ex:
Material cost 100
Activity Cost 500

Service based Industry sector

B where activity price minute level then we can propose this ABC costing

c when main Labour/Manpower Acivity devide into Minute level of Business Process

Main Activity Type - Manpower/Labour

Manager These are 3 called Business Process

Clerk
Supervisor

d do not give Labour activity type in the work center this is important point

1 Activate the activity based costing in controlling Area

component active for parallel and integration calculation >>> both plan and actual maintain
2 OKW1 Maintain stanadra hirerachy for controlling Area

3 CP01 Create Business Process

Business Process is a one of the master data like cost center , activity type, skf

please enter details as per the LAB activity type in Manager Business Process
unit of measurement, Allocation cost elements, allocation category, price indicator

Create supervior business process

 Create Clerk Business Process

4 CPH1 Maintain Business Process Groups

5 KS01 Create cost center for ABC costing

6 KP26 Activity Type/Price Planning

Give 730 hours

7 KP06 cost element with Activity input planning

Give fixed cost - 10000 and

 Give fixed cost - 3000 and v

Give fixed cost - 2000 and variable cos

8 CP06 Business Process planning / Quantity

Group-2022 as we created above

LAB - Activity Type 's Total Hours - 1000Hours in {KP26 ] So these 1000 hours divided into Business Pro

9 CP06 Business Process planning with cost element/Activity Inputs

Give the 1800 and 200 for managers

Click on Next

Ckick on Next
10 KSH1 Create Cost Center Group

Cost Center Group - 2022-ABC

11 KSPI Execute Paln Price Calculation

Run with Test Run. Later remove test run and execute

Object Type : BPR means Business Process

Object Type : ATY means Activity Types
 Remove Test Run and Execute

12 KP27 Check Activity type prices

our target/Intension is to check the LAB

13 CP27 Business process Qty/Prices

14 Maintain Template

Create Template

SBP is Business process

 Below create another environment for Business process

15 KTPF Assign Templates for cost object and costing

 Here assign the template to costing she

16 CP02 Maintain Business Process

Assign SBP template which I created above and assign in each Business Process
 Testing for ABC Costing

1 CR01 Create workcenter

Do not give Labour activity type just keep blank

2 MM01 Create Material Master

3 CS01 Create BOM

4 CA01 Create Routing

Here we created workcenter above give that one

that work center not included Labour activity type. Give workcenter without labout activity

Double click on 0010

 Labour is not included in routing . Just objreve above screen

5 MM02 Production version in material master

6 CK11N/CK24 Cost estimate and release cost estimate

objerve here that Labour activity type is not updated and Business Process are updated
 That total Business process amount showing under the Manpower

7 CO01 Create Produciton Order

 In production order we can see one row added that is Miscllaneous means business process
But Labour activity type is not included in prodcution Order. Business process added as miscl

8 CO11N Confirmation of activity type and goods issue and goods receipt
 9 CO03 Display Production order

Goods issue has updated and goods receipt updated and Activity types that is Machin and

but Business process are not updated for this we need to run Template allocate which are cr

10 CPTA Actual Template Allocation

11 CO03 Production order display

Business process are updated inproduction order after actual template allocation executeed

12 KGI2 Actual OverHead Executation

13 KKS2 Variance calculation

14 KO88 Settlement of prodution order

15 CO03 Display production order

Business Process

oth plan and actual maintain

activity type, skf
Give fixed cost - 10000 and variable cost - 2000
 Give fixed cost - 3000 and variable cost - 500

d cost - 2000 and variable cost - 400

urs divided into Business Process ( Mananger, Supervisior , Clerk ) into CP26
That KP06 of Salaries amount 3500 will divided into Business Process ( clerk,super,Manager)
900 + 100 / 00100 fixed + Variable price / Price Unit = then get price
gn the template to costing sheet , which I created above as the 2022-abc`
center without labout activity type
siness Process are updated
neous means business process
usiness process added as miscllaneous

oods receipt
vity types that is Machin and Power activity updated

emplate allocate which are created above then Business process will update after template allocation
mplate allocation executeed
12