Evaluating MTO with Service

The forklift manufacturer's customers commission the company to maintain their forklifts. In this scenario, a service order is placed for 10 hours. To evaluate the actual costs and revenue, a Work Breakdown Structure element (WBS) is created. A customer order is then created for the service product, and the WBS is assigned to the customer order item.

The customer order item contains a position type that indicates no delivery is required for invoicing. The requirement type in the customer order item ensures that actual revenue is posted to the WBS when the invoice is posted. As employees provide the service, a service allocation is posted from the cost center to the WBS. After invoicing, the actual revenue, actual costs, and resulting margin can be evaluated in Margin Analysis with reference to the WBS.

1. Perform Prerequisites and Check the Master Data

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2. Create WBW-Element and Sales Order

   In this exercise, you will:

   1. Create the WBS for your sales order service
   2. Create the sales order and assign your WBS to it
   3. Verify the requirement type and conditions in the sales order

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3. Perform Activity Allocation and the Sales Order Billing

   After employees have completed the service, you will allocate the actual time from the service cost center to the WBS using performance allocation. You can then analyze the actual costs on the WBS before proceeding with invoicing. Finally, you can evaluate the results in Margin Analysis.

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