Configuring the Costing Variant

In the Quantity structure tab, you determine the following:

• How the costing lot size is handled (see Pass On Lot Size)
• Whether cost estimates without quantity structure are included
• Whether transfer control can be changed when calling the cost estimate
• Whether an active standard cost estimate can be transferred if the cost estimate for a material contains errors

In the Additive Costs tab, you determine the following:

• Whether you can transfer the cost components that were entered in the form of an additive cost estimate
• Whether the additive costs for materials with the special procurement types stock transfer or production are included in another plant

In the Update tab, you determine the following:

• Whether the costing results can be saved and what values are updated.

  The cost component split is always updated. You must specify whether the following values are also updated: Itemization, Log.

• Whether the user can change the update parameters and the parameters for transfer control.
• Which reference variant you want to use for group costing.

In the Assignments tab, you determine the following:

• Which cost component structure is used for the cost estimate (see also, Define Cost Components)
• Which costing version is used
• Whether the cost component split can be saved in the controlling area currency in addition to the company code currency
• Whether you can cost across company codes with this costing variant

In the Miscellaneous tab, you determine the following:

• Whether a log is created to collect the system messages

In the Costing Type, you define the purpose of a material cost estimate by specifying, for example, which field in the material master record the costing results can be transferred to:

• Standard price - Standard cost estimate (01)

• Tax-based price - Inventory cost estimate

• Commercial price - Inventory cost estimate

• Price other than std price - Modified standard cost estimate or current cost estimate

• No update - Any cost estimate

• Material valuation:

  Here, you define the sequence in which the system searches for prices from the accounting view or costing view of the material master record to valuate materials. You can also access prices from purchasing info records and condition types. For material cost estimates, you also specify whether additive costs can be added to the selected price. With configurable/configured material components and with procurement alternatives, the sequence defined here is ignored if the strategy "price from purchasing info record" was selected, in which case that strategy is always executed first.

• Activity Types / Processes:

  Here, you define the sequence in which the system searches for prices in activity type planning or actual activity price calculation in Cost Center Accounting or Activity-Based Costing to valuate the utilized activity types and business processes. You also specify which plan/actual version is used.

• Subcontracting:

  Here, you define the sequence in which the system searches for prices in the purchasing info record. In purchasing, quota arrangements are used to create a mixed price for materials that are manufactured with external vendors with parts provided by the customer. You can specify whether the quota of the individual vendors that are entered in the source list for the material to be processed should be determined through the planned quota arrangement or the actual quota arrangement.

• External processing:

  Here, you define the sequence in which the system searches for prices in the purchasing info record or routing operation for valuation of the external activities.

• Overhead costs:

  You can link the valuation variant for definition of overhead to a costing sheet. You can also enter a costing sheet for the allocation of overhead to raw materials, if you want to use specific overhead conditions for raw materials. If you want to differentiate overhead application according to material groups, you must have defined overhead groups and made the necessary settings for the costing sheet in the step Define costing sheet.

• Price Factors:

  If you want to use the valuation variant for inventory costing, you can link it to price factors.

In costing, date control IDs control the dates on which the quantity structure and the value structure are created. The dates determine the following parameters:

• For product costing (material cost estimate with quantity structure, sales order costing, and production lot costing (SEIBAN)):

  • The validity period of the cost estimate

  • The date on which the quantity structure is determined (quantity structure date)

  • The date on which the quantity structure is valuated (valuation date)

• For unit costing of materials without quantity structure, internal orders, projects, and ad-hoc cost estimates:

  • The validity period of the cost estimate

  • The date on which the costing items are valuated (valuation date)

Date control determines which dates are proposed or displayed when a cost estimate is created, and whether these dates can be changed by the user.

If you want to calculate variances with reference to the cost estimate, make sure that the cost estimate is valid in the periods in which you will calculate the variances.

If you intend to valuate scrap or work in process with the results of the standard cost estimate, you should make sure that the cost estimate is valid in the periods in which you will calculate variances or work in process.

Quantity structure determination is used in cost estimates with quantity structure to specify for each plant how the system searches for valid alternative BOMs and alternative routings to create a quantity structure for multilevel BOMs. The search is carried out on the basis of two parameters:

• Application of BOMs to determine alternatives automatically:

  This key determines how the system should choose the suitable alternative for the different company areas in which the BOM is used.

• Selection ID for selecting alternative routings:

  This key determines the priority given to routings during routing selection.

Quantity structure determination also specifies whether the required quantity for BOM components with dimensional units of measure is rounded up to the next whole number if the calculation of scrap-adjusted quantities results in a fraction.

Quantity structure determination is also linked to the order type for each plant.

To be able to use the quantity structure determination in costing, you must assign it to the costing variant.

In this step you define parameters for partial costing. The purpose of partial costing is to prevent the system from creating a new cost estimate for a material when costing data already exists. Instead, the existing costing data is simply transferred into the new cost estimate. This improves performance.

Partial costing is particularly useful in the following situations:

• You want to cost a new product. The BOM for this product contains materials that have already been costed, and you do not want to cost these materials again.

• You want to cost all new products during the fiscal year. You define a costing run that includes all materials, and use transfer control so that only new products are selected.

• You want to plan the costs for a sales order in product costing.

  • Some materials are carried in the sales order stock. These materials are produced or ordered for the sales order. You want to recost these materials.

  • Other materials are carried as collective requirements. These materials are withdrawn from stock and the costs are taken from the current standard cost estimate.

• In the special procurement type you specified that cross-plant transfer is to take place. In the other plant, the quantity structure is not determined and is not costed.

In this step you define reference variants.

Reference variants allow you to create material cost estimates or costing runs based on the same quantity structure for the purpose of improving performance or making reliable comparisons.

The following are examples of situations where reference variants are useful:

• When you create a standard cost estimate and use it as a reference (template) for an inventory cost estimate. With a reference variant, the system can use the quantity structure of the standard cost estimate when it calculates the inventory cost estimate without having to redetermine the quantity structure. In the reference cost estimate, you specify that the overhead for the inventory cost estimate should still be calculated differently.

• When you use the functions of multiple valuation in group costing and execute a costing run in the legal valuation view. (In Customizing for Enterprise Controlling you have defined in the currency and valuation profile that the legal valuation view is the operational view and therefore the main view for costing). You use the costing run as a reference to carry out costing runs based on the same quantity structure for the two other valuation views. This improves performance and provides you with cost estimates that only differ in the valuations.

• Understand the components and configuration of a costing variant to control costing results effectively.
• Configure costing types to specify price updates, date keys, and overhead calculation basis.
• Utilize valuation variants to determine price sources for materials, activities, and external processes.
• Apply date control to manage validity and valuation dates for cost estimates.
• Implement further settings like quantity structure, additive costs, and error management for comprehensive costing control.