SAP CO Product Costing-"By Period Scenario" in S/4 HANA

Description

The topic of Product Costing, especially in the realm of Repetitive Manufacturing in SAP S/4HANA , is extensive. Let's delve into these points:

1. Difference between Discrete and Repetitive Manufacturing Process:

   • Discrete Manufacturing: This process is order-specific and often relates to products that are produced in batches or lots. Each batch could potentially be different from the next. Typically, production orders are used here.

   • Repetitive Manufacturing: Here, a product is produced continuously, often over long periods and without interruption. In this process, no individual production orders are created; instead, a product cost collector is used.

2. Identifying Materials for Repetitive Manufacturing: Materials suitable for repetitive manufacturing are those that have a consistent production process and are produced continually. The material master will have an indicator set for repetitive manufacturing.

3. Purpose of Product Cost Collector in Repetitive Manufacturing: A product cost collector is used to collect costs for a product over a period. It simplifies the process of cost capture in repetitive manufacturing by acting as a receiver for all costs without needing individual production orders.

4. Creating Product Cost Collector in Repetitive Manufacturing: The creation can be done via transaction KKF6N. Before creating a PCC, ensure the material master is set for repetitive manufacturing and a production version exists.

5. Cost Collection/Capture to Product Cost Collector: Costs can be directly posted to the product cost collector. This includes labor costs, material costs, and overheads. The benefit is that individual production order assignment is avoided, streamlining the process.

6. Explanation of Reporting Points: Reporting points in repetitive manufacturing allow the capture of production quantities and values at specific points in the production process. They are defined in the routing and enable tracking of costs and quantities at intervals.

7. "Work in Process" Concept between Discrete and Repetitive Manufacturing Process:

   • In Discrete Manufacturing, WIP is calculated based on the status of each production order at period-end.

   • In Repetitive Manufacturing, WIP is calculated based on reporting points. Costs and quantities are captured at these points, helping determine WIP more effectively.

8. Decoupling Scenario: Mix of Product Cost Collector and Production Order: Sometimes, both methods are used in a hybrid fashion, where primary costs are collected on a PCC and specific orders are used for special processes or components.

9. Linking between Product Cost Collector and Production Order: Even though PCC replaces the need for production orders in repetitive manufacturing, there are scenarios where a link might be needed, especially in decoupled scenarios. The link ensures costs are rolled up accurately.

10. Indirect Cost Capture to Product Cost Collector: Costs can be posted directly to a PCC or indirectly via activities, processes, or even orders. These indirect costs will then be settled to the PCC.

11. Designing Costing Variant, Costing Sheet, Template Allocation for Product Cost Collector: This defines how costs are calculated and allocated. A costing variant contains parameters for cost estimates. The costing sheet determines overhead application, and template allocation helps distribute costs based on specific logic.

12. Month End Closing of Product Cost Collector: At month-end, all costs on the PCC should be settled to a final cost object, typically a material ledger. The settlement process ensures costs are transferred and the PCC is ready for the next period.

TAKE THIS COURSE