CONTROLLING BASICS AND COST CENTER ACCOUNTING VIL (2)

CONTROLLING (CO)
THIS IS USED FOR INTERNAL REPORTING. IN CONTROLLING (CO)

ORGANIZATIONAL HIERARCHY THE HIGHEST NODE IS CONTROLLING AREA.
AREAS TO BE COVERED:-
1) BASIC SETTINGS FOR CONTROLLING
A) MAINTAIN CONTROLLING AREA

B) DEFINE NUMBER RANGE INTERVAL FOR CONTROLLING DOCUMENTS
C) MAINTAIN VERSIONS
2) COST ELEMENT ACCOUNTING
TO UPDATE FI RECORDS GENERAL LEDGER ACCOUNTS ARE REQUIRED.

TO UPDATE CO RECORDS COST ELEMENTS ARE REQUIRED.
THERE ARE 2 TYPES OF COST ELEMENTS -
A) PRIMARY COST ELEMENTS
B) SECONDARY COST ELEMENTS
3) COST CENTER ACCOUNTING
THIS IS USED TO VIEW DEPARTMENTWISE COST. IN ORGANIZATIONS THERE

WILL BE NUMBER OF DEPARTMENTS.
Eg:-PRODUCTION DEPARTMENTS/SERVICE DEPARTMENTS etc,.
4) INTERNAL ORDERS
THIS IS USED TO VIEW COST FOR SPECIFIC TASKS.
Eg:- VEHICLEWISE RUNNING EXPENSES/TELEPHONEWISE EXPENSES/
PRODUCTION ORDER COSTS/EXHIBITION COST.
ORDERS ARE OF 2 TYPES:-
A) REAL ORDERS
B) STATISTICAL ORDERS
5) CLASSIC PROFIT CENTER ACCOUNTING
UPTO 4.7EE(OLD) VERSION PROFIT CENTER ACCOUNTING WAS PART OF

CONTROLLING. THIS IS CALLED CLASSIC PROFIT CENTER ACCOUNTING.
FROM ECC6(NEW) VERSION PROFIT CENTER ACCOUNTING IS PART OF

FINANCIALS. THIS IS CALLED ECC6 PROFIT CENTER ACCOUNTING OR NEW G/L
PROFIT CENTER ACCOUNTING.
HERE WE DISCUSS THE DIFFERENCES BETWEEN CLASSIC PROFIT CENTER

ACCOUNTING AND ECC6 OR NEW G/L PROFIT CENTER ACCOUNTING.
1
UPTO4.7EE(OLD) VERSION TO VIEW DIVISIONWISE PROFITABILITY
COMPANIES USED CLASSIC PROFIT CENTER ACCOUNTING.
6) PRODUCT COSTING
THIS IS USED FOR VALUATION OF INVENTORIES i.e., WORK IN PROCESS AND

FINISHED GOODS.
VALUATION OF FINISHED GOODS IN THE BEGINNING WILL BE DONE AT

STANDARD COSTING.
SAP HAS GIVEN 2 SCENARIOS FOR STANDARD COSTING.
A) CREATION OF COST ESTIMATE WITH QUANTITY STRUCTURE(THIS IS USED

WHERE PRODUCTION PLANNING i.e., PP MODULE IS IMPLEMENTED),
B) CREATION OF COST ESTIMATE WITHOUT QUANTITY STRUCTURE(THIS IS
USED WHERE PRODUCTION PLANNING i.e., PP MODULE IS NOT
IMPLEMENTED)
IN THE MONTH END WE GET ACTUAL COST. FOR ACTUAL

COSTING(SIMULTANEOUS COSTING) SAP HAS GIVEN 3 SCENARIOS.
A) PRODUCT COST BY ORDER( PRODUCTION ORDER)

B) PRODUCT COST BY PERIOD
C) PRODUCT COST BY SALES ORDER
7) PROFITABILITY ANALYSIS (CO-PA)
THIS IS USED TO VIEW PROFITABILITY FOR NUMBER OF PARAMETERS AT A

TIME. Eg., CUSTOMERWISE/PRODUCTWISE/SALES ORGANIZATIONWISE/
PLANTWISE/ SALES ORDERWISE PROFITABILITY.
THIS IS A REPORTING TOOL.
8) ECC6 NEW FEATURES

A) NEW GENERAL LEDGER ACCOUNTING OR MULTIPLE LEDGERS
ACCOUNTING-ALREADY COVERED IN FI.
B) SEGMENTS CREATION-ALREADY COVERED IN FI.
C) DOCUMENT SPLITTING
D) ONLINE RECONCILIATION LEDGER
E) FOREIGN CURRENCY BALANCES REVALUATION-VALUATION AREA WISE-
ALREADY COVERED IN FI.
F)CLOSING COCKPIT- ALREADY COVERED IN PROJECT
9) MATERIAL MANAGEMENT (MM) MODULE TO FINANCIALS(FI) MODULE AND

CONTROLLING(CO) MODULE INTEGRATION.
2
10) SALES AND DISTRIBUTION (SD) MODULE TO FINANCIALS (FI) MODULE
AND CONTROLLING (CO)MODULE INTEGRATION.
11) PRODUCTION PLANNING(PP) MODULE TO FINANCIALS (FI) MODULE AND

CONTROLLING(CO) MODULE INTEGRATION.
12)GOODS AND SERVICES TAX(GST)-CIN i.e., COUNTRY INDIA VERSION
13) SPECIAL SCENARIOS
A) ACTIVITY TYPES i.e., MACHINE HOUR/LABOUR HOUR RATE CALCULATION

B) ACTIVITY DEPENDENT PLANNING AND ACTIVITY INDEPENDENT PLANNING
C) DIRECT ACTIVITY ALLOCATION AND INDIRECT ACTIVITY ALLOCATION
D) PLANNING COST CENTERWISE FOR NEXT YEAR BASED ON ACTUALS OF
CURRENT YEAR WITH REVALUATION
E) SPLITTING STRUCTURE
F) JOINT PRODUCT COSTING i.e., MAIN PRODUCT, CO- PRODUCT AND BY-
PRODUCT COSTING
G) MIXED COSTING
H) SCRAP- 3 TYPES 1) ASSEMBLY SCRAP 2) COMPONENT SCRAP 3) OPERATION
SCRAP
I) MATERIAL LEDGER
J) PROFITABILITY ANALYSIS PLANNING
K) PROFITABILITY ANALYSIS CHARACTERISTICS DERIVATION
L) PROFITABILITY ANALYSIS TABLES
M) PROFITABILITY ANALYSIS RECORD TYPES
N) COST CENTER ASSESSMENT TO PROFITABILITY ANALYSIS
O) SUMMARIZATION LEVELS IN PROFITABILITY ANALYSIS
P) TOP DOWN DISTRIBUTION IN PROFITABILITY ANALYSIS
Q) DIFFERENCE BETWEEN COSTING BASED PROFITABILITY ANALYSIS AND
ACCOUNT BASED PROFITABILITY ANALYSIS
3
BASIC SETTINGS FOR CONTROLLING
1.MAINTAIN CONTROLLING AREA
AN ORGANIZATIONAL UNIT WITHIN A COMPANY USED TO REPRESENT A

CLOSED SYSTEM FOR COST ACCOUNTING PURPOSE. A CONTROLLING AREA
MAY INCLUDE SINGLE OR MULTIPLE COMPANY CODES THAT MAY USE
DIFFERENT CURRENCIES. THOSE COMPANY CODES MUST USE THE SAME
OPERATING CHART OF ACCOUNTS AND FISCAL YEAR VARIANT.
FOR CONTROLLING MODULE CONTROLLING AREA IS MANDATORY.
IT RECORDS ALL OVERHEAD RELATED ACTIVITIES i.e., COST CENTER

ACCOUNTING, INTERNAL ORDERS, ALL MANUFACTURING RELATED
ACTIVITIES i.e., PRODUCT COSTING AND PROFIT CENTER RELATED
ACTIVITIES.
CO FI
CO-Area Co Cd
Scenario:1 (1:1 relationship)
Company Code = Controlling Area
(Company code and Controlling area are in same levels or
One Company code under a Controlling area)
Scenario 2: (1:n relationship)
Company Code under the Co area(more than one Co Cd under a Co-area)
This is also called cross company code cost accounting.
CO-area Company Code
CoCd 1
Co Area1
CoCd 2
CoCd 3
Co Area2
CoCd4
4
Eg.,:-
FI ORGANIZATION OR CO-ORGANIZATION STRUCTURE OR
ENTERPRISE STRUCTURE ENTERPRISE STRUCTURE
COMPANY CONTROLLING AREA
COMPANY CODE
SEGMENTS
PROFIT CENTERS COST CENTERS
WHEN WE COMBINE FI AND CO- WE WILL HAVE 2 SCENARIOS
1ST SCENARIO
CONTROLLING AREA AT COMPANY CODE LEVEL
COMPANY
COMPANY CODE = CONTROLLING AREA
SEGMENTS
PROFIT CENTER
COST CENTERS
PROFIT CENTER WILL BE ASSIGNED IN COST CENTER. EACH COMPANY CODE

WILL HAVE SEPARATE CONTROLLING AREA.
2ND SCENARIO
CONTROLLING AREA AT COMPANY(GROUP) LEVEL. NUMBER OF COMPANY

CODES WILL HAVE ONE CONTROLLING AREA
5
COMPANY = CONTROLLING AREA
COMPANY CODE
SEGMENTS
PROFIT CENTER
COST CENTERS
PROFIT CENTER WILL BE ASSIGNED IN COST CENTER.

NUMBER OF COMPANY CODES WILL HAVE ONE CONTROLLING AREA.
WHICH SCENARIO COMPANIES WILL CHOOSE : -

A) WHERE MANAGEMENT WANTS TO SEE NUMBER OF COMPANY CODES COST
CENTERS DATA AT A TIME
- IT IS NOT POSSIBLE IN 1ST SCENARIO
- IT IS POSSIBLE IN 2ND SCENARIO
B) WHERE MANAGEMENT WANTS TO VIEW NUMBER OF COST CENTERS DATA

OF A COMPANY CODE
- IT IS POSSIBLE IN 1ST SCENARIO
- ALSO IT IS POSSIBLE IN 2ND SCENARIO BY CREATING COST CENTER
GROUPS
C) WHERE THE ACTIVITIES ARE DIFFERENT

- VARUN INDUSTRIES LIMITED VARUN STEELS LTD
- CEMENT MANUFACTURING STEEL MANUFACTURING

- GO FOR 1ST SCENARIO
D) WHERE THE ACTIVITIES ARE SAME

- VARUN INDUSTRIES LTD VARUN STEELS LTD
STEEL MANUFACTURING
- GO FOR 2ND SCENARIO
IN THE BEGINNING WE GO FOR 1ST SCENARIO i.e., EACH COMPANY CODE WILL
HAVE SEPARATE CONTROLLING AREA.
IF WE GO FOR 1ST SCENARIO
COMPANY CODE SHOULD BE THE CONTROLLING AREA CODE
6
COMPANY CODE CONTROLLING AREA
VIL VIL
VIL VIL
HIL HIL
IF WE GO FOR 2ND SCENARIO :-

CONTROLLING AREA CODE CAN BE ANY CODE
PATH: SPRO --> CONTROLLING --> GENERAL CONTROLLING -->

ORGANIZATION--> MAINTAIN CONTROLLING AREA (TR.CODE IS OKKP)
--> DOUBLE CLICK ON MAINTAIN CONTROLLING AREA

--> SELECT POSITION BUTTON
--> CONTROLLING AREA : VIL ENTER
--> SELECT CONTROLLING AREA VIL
--> SELECT DETAILS BUTTON
COST CENTER STANDARD HIERARCHY :-
A TREE LIKE HIERARCHY STRUCTURE GROUPING ALL THE COST CENTERS OF A

CONTROLLING AREA.
IT HELPS US IN ANALYSING THE COST SUMMARY AT THE END OF NODES OF
HIERARCHY.
WHEN WE CREATE A COST CENTER WE HAVE TO SPECIFY COST CENTER
STANDARD HIERARCHY.
WHEN WE CREATE A COST CENTER WE HAVE TO SPECIFY UNDER WHICH COST
CENTER STANDARD HIERARCHY WE ARE CREATING COST CENTERS
-->COST CENTER STANDARD HIERARCHY : VILHIER
COST CENTERS DEPTM DEPTN DEPTO
WHEN WE WANT TO SEE COST CENTER DEPTM DATA - IN THE REPORT

WE GIVE COST CENTER - DEPTM.
WHEN WE WANT TO SEE COST CENTER DEPTN DATA -IN THE REPORT
WE GIVE COST CENTER - DEPTN.
WHEN WE WANT TO SEE ALL COST CENTERS DATA - IN THE REPORT WE
GIVE COST CENTER GROUP–VILHIER.
2. MAINTAIN NUMBER RANGES FOR CONTROLLING DOCUMENTS

[ KANK ]
I . CO THROUGH POSTINGS FROM FI (BUSINESS TRANSACTION – COIN)
FI POSTING USING TRANSACTION CODE - FB01L
Eg : - SALARIES A/C DR 100000 COST CENTER : DEPTM

TO BANK A/C 100000
7
1 FI DOCUMENT 1 CO DOCUMENT ( COIN )
DOCUMENT TYPE SA COIN
| |
NUMBER RANGE 01 01
| |
NUMBER RANGE INTERVAL 1-100000 1-100000
MANUAL POSTING IN FB01L AUTOMATIC POSTING
II. REPOST CO LINE ITEMS (BUSINESS TRANSACTION –RKU3)
AT THE TIME OF POSTING IN FI , FI USER DOES NOT KNOW WHICH COST

CENTER TO UPDATE . HE UPDATES COMMON COST CENTER . AFTERWARDS
CO USER WILL TRANSFER FROM COMMON COST CENTER TO RESPECTIVE
COST CENTERS.
FOR THAT TRANSFER NO FI DOCUMENT WILL BE GENERATED

ONLY CO DOCUMENT WILL BE GENERATED
IN THIS METHOD THERE ARE 2 SCENARIOS :

1. TRANSFER DOCUMENTWISE
2 . TRANSFER LINE ITEMWISE
1ST SCENARIO : TRANSFER DOCUMENT WISE
FI PERSON IN FB01L :
SALARIES DR 800000 COST CENTER:
COMMON
TRANSFER TO DEPTM 400000
DEPTN 300000
DEPTO 100000
TO BANK 800000
1 FI DOCUMENT NO FI DOCUMENT
1 CO DOCUMENT(COIN) 1 CO DOCUMENT [ RKU3]
TOTAL DOCUMENTS GENERATED :-
1 FI DOCUMENT
2 CO DOCUMENTS
2ND SCENARIO : TRANSFER LINE ITEMWISE
8
FI PERSON IN FB01L :-
SALARIES DR 200000 COST CENTER:
COMMON
TRANSFER TO DEPTM 100000
DEPTN 75000
DEPTO 25000
RENT DR 100000 COST

CENTER:DEPTM
TO BANK 300000
1 FI DOCUMENT NO FI DOCUMENT
1 CO DOCUMENT ( COIN ) 1 CO DOCUMENT ( RKU3 )
III . REPOST COSTS ( BUSINESS TRANSACTION – RKU1)
THIS IS USED WHEN WE SPLIT THE COST CENTER INTO NUMBER OF COST
CENTERS OR WRONG COST CENTER POSTINGS.
NO FI DOCUMENT WILL BE GENERATED.

ONLY CO DOCUMENT WILL BE GENERATED.
TRANSFER COST ELEMENTWISE (G/L ACCOUNTWISE)
Eg : WE HAVE COST CENTER DEPTM - WE HAVE POSTED TRANSACTIONS UPTO
30TH JUNE,23. WE HAVE DECIDED TO SPLIT THE COST CENTER INTO DEPTM
AND DEPTZ. FROM 01ST JULY 2023 POSTINGS CAN BE MADE TO RESPECTIVE
COST CENTERS.
COST DEPTM DEPTZ

CENTER
30/04/2023 400100 200000

SALARIES
31/05/2023 400100 225000

SALARIES
30/06/2023 400100 250000

SALARIES
400100 675000 30/06/20 400100 300000

TOTAL 23 SALARIES
30/04/2023 400101 500000
9
WAGES
31/05/2023 400101 550000

WAGES
30/06/2023 400101 525000

WAGES
400101 1575000 30/06/20 400101 700000

TOTAL 23 WAGES
30/04/2023 400300 75000

RENT
31/05/2023 400300 75000
RENT
30/06/2023 400300 75000
RENT
400300 235000 30/06/20 400300 100000
TOTAL 23 RENT
IV. PLANNING PRIMARY COSTS ( BUSINESS TRANSACTION -RKP1)
PLANNING /BUDGETING COST CENTERWISE FOR EACH COST ELEMENT.
PATH: SPRO --> CONTROLLING --> GENERAL CONTROLLING -->

ORGANIZATION --> MAINTAIN NUMBER RANGES FOR CONTROLLING
DOCUMENTS [T/C KANK ]
--> CONTROLLING AREA : VIL
--> SELECT MAINTAIN GROUPS BUTTON
--> SELECT CREATE BUTTON
--> GROUP: CO DOC NO. RANGE INTERVAL FOR VIL
--> FROM NUMBER : 1
--> TO NUMBER : 100000
--> SAVE
--> IGNORE THE MESSAGE AND ENTER
--> SELECT BACK ARROW
--> KEEP THE CURSOR ON COIN
10
--> SELECT ELEMENT / GROUP BUTTON
--> KEEP THE CURSOR ON NO.RANGE 01
--> ENTER
--> KEEP THE CURSOR ON RKU3
--> ENTER
--> KEEP THE CURSOR ON RKU1
--> ENTER
--> KEEP THE CURSOR ON RKP1
--> ENTER
--> SAVE
3. MAINTAIN VERSIONS
TO ENTER ANY TRANSACTIONAL DATA i.e., PLAN /ACTUALS IN CONTROLLING,

WE NEED TO MAINTAIN VERSIONS.
EACH FISCAL YEAR WE HAVE TO MAINTAIN VERSIONS.
IT ALLOWS US TO MAINTAIN DIFFERENT PLAN (OR ) BUDGET NUMBERS TO BE

ABLE TO MONITOR ACTUAL NUMBERS.
WE MUST DEFINE MINIMUM ONE VERSION . USUALLY VERSION 0 WHICH IS

KNOWN AS PLAN / ACTUAL VERSION.
VERSIONS ENABLE US TO CARRY PARALLEL SETS OF PLANNING DATA FOR

THE SAME OBJECT.
Eg: - ORIGINAL VERSION / REVISED VERSION / RE - REVISED VERSION

( OR )
OPTIMISTIC PLAN DATA AND PESSIMISTIC PLAN DATA
11
Eg : -1
WE HAVE PLANNED FOR THE WHOLE YEAR VERSION - 0 - ORIGINAL BUDGET
AFTER 2 MONTHS CHANGE PLANNED FIGURES VERSION - 1 - REVISED

BUDGET
AFTER 6 MONTHS CHANGE PLANNED FIGURES VERSION - 2 – RE-REVISED

BUDGET
AFTERWARDS WE CAN COMPARE
ORIGINAL BUDGET i.e., VERSION 0/
ACTUALS WITH REVISED BUDGET i.e., VERSION 1/
RE-REVISED BUDGET i.e., VERSION 2
Eg: - 2
PLANNED FOR WAGES FOR THE WHOLE YEAR
OPTIMISTIC PLANNING WAGES 500000 VERSION 0

PESSIMISTIC PLANNING WAGES 2000000 VERSION 1
AFTERWARDS WE CAN COMPARE :-

OPTIMISTIC VERSION i.e., VERSION 0/
ACTUALS WITH PESSIMISTIC VERSION i.e., VERSION 1
PATH : SAME PATH
--> SELECT VERSION 0 PLAN /ACTUAL VERSION

--> DOUBLE CLICK ON SETTINGS FOR EACH FISCAL YEAR FOLDER
--> CO AREA: VIL
--> ENTER
--> SELECT NEW ENTRIES BUTTON
-->FISCAL YEAR: 2028
--> EXCHANGE RATE TYPE : SELECT B (BANK SELLING RATE)
--> SAVE
--> SELECT CREATE REQUEST BUTTON
--> SHORT DESCRIPTION : CO CUSTOMIZATION FOR VIL
--> ENTER AND PRESS ENTER TO SAVE IN YOUR REQUEST
COST ELEMENT ACCOUNTING
TO UPDATE FI RECORDS G/L ACCOUNTS ARE REQUIRED

TO UPDATE CO RECORDS COST ELEMENTS ARE REQUIRED
COST ELEMENTS REPRESENT ORIGIN OF COSTS
12
2 TYPES OF COST ELEMENTS
A. PRIMARY COST ELEMENT
PRIMARY COST ELEMENTS ARE NOTHING BUT G/L EXPENDITURE AND

INCOME ACCOUNTS.
TO TRANSFER VALUES FROM FI TO CO PRIMARY COST ELEMENTS ARE

CREATED.
Eg : - CREATE G/L ACCOUNT 400100 SALARIES ACCOUNT AS PRIMARY COST

ELEMENT .
POSTING TO PRIMARY COST ELEMENTS POSSIBLE
B .SECONDARY COST ELEMENT
SECONDARY COST ELEMENTS ARE OTHER THAN G/L ACCOUNTS.

POSTING TO SECONDRY COST ELEMENTS NOT POSSIBLE.
THEY ARE USED FOR ALLOCATIONS
Eg: - COST CENTERS
DEPTO DEPTM DEPTN
(SERVICE DEPT ) ( PRODUCTION DEPT )
WAGES 200000
POWER 100000
SALARIES 50000
TOTAL = 350000
IN THE MONTH END ALLOCATE DEPTO COST TO DEPTM AND DEPTN BY USING
SECONDARY COST ELEMENT .
1. WHAT IS PRIMARY COST ELEMENT
PRIMARY COST ELEMENTS REPRESENT THE CONSUMPTION OF PRODUCTION

FACTORS SUCH AS RAW MATERIALS ,PERSONNEL COST , UTLITIES etc .,
PRIMARY COST ELEMENTS HAVE THEIR CORRESPONDING G/L ACCOUNTS IN FI
WE CAN CREATE REVENUE ACCOUNTS ALSO AS PRIMARY COST ELEMENTS IN

CO . THEY ARE IDENTIFIED WITH NEGATIVE SIGN WHILE POSTING IN CO .
WITHOUT HAVING G/L ACCOUNTS WE CAN NOT CREATE PRIMARY COST

ELEMENTS.
2.WHAT IS SECONDRY COST ELEMENT
13
SECONDRY COST ELEMENTS REPRESENT THE CONSUMPTION OF PRODUCTION
FACTORS PROVIDED INTERNALLY BY THE ENTERPRISE ITSELF AND ARE
PRESENT ONLY IN CO .
THEY ARE ACTUALLY LIKE COST CARRIERS TO TRANSFER THE COST FROM
ONE COST OBJECT TO OTHER COST OBJECTS.
WHILE CREATING SECONDARY COST ELEMENTS WE SHOULD NOT USE G/L

ACCOUNTS SERIES .
WHEN WE CREATE A COST ELEMENT WE HAVE TO SPECIFY COST ELEMENT

CATEGORY (GIVEN BY SAP )
WHEN WE WANT TO SEE NUMBER OF COST ELEMENTS DATA AT A TIME WE

CREATE COST ELEMENT GROUP AND ASSIGN THE RESPECTIVE COST
ELEMENTS TO COST ELEMENT GROUP.
WHAT IS COST ELEMENT CATEGORY :-
THE CLASSIFICATION OF COST ELEMENT ACCORDING TO THEIR USE OR

ORIGIN .
eg :- EXPENDITURE COST ELEMENTS / INCOME COST ELEMENTS /

SETTLEMENT COST ELEMENTS FOR INTERNAL ORDERS / COST ELEMENTS
FOR ALLOCATING INTERNAL ACTIVITIES .
ALL THE COST ELEMENTS NEED TO BE ASSIGNED TO A COST ELEMENT

CATEGORY TO DETERMINE THE TRANSACTIONS FOR WHICH WE CAN USE THE
COST ELEMENTS .
2 TYPES OF COST ELEMENT CATEGORIES-i)PRIMARY COST ELEMENT

CATEGORIES ii)SECONDARY COST ELEMENT CATEGORIES.
PRIMARY COST ELEMENT CATEGORIES:
1. PRIMARY COSTS / COST REDUCING REVENUES-THIS IS USED FOR

EXPENDITURE ACCOUNTS
3. ACCRUAL / DEFERRAL PER SURCHARGE -THIS IS USED FOR MONTH END

PROVISIONS ONLY IN CO
11. REVENUES-THIS IS USED FOR INCOME ACCOUNTS
12. SALES DEDUCTION- THIS IS USED FOR EXPENDITURE ACCOUNTS LIKE

SALES COMMISSION,TRADE DISCOUNT WHERE CO-PROFITABILITY
ANALYSIS MODULE IS IMPLEMENTED.
14
22. EXTERNAL SETTLEMENT - THIS IS USED FOR SETTLEMENT OF COST FROM
INTERNAL ORDER TO G/L ACCOUNTS OR ASSETS ( CO – FI)
SECONDARY COST ELEMENT CATEGORIES:
21. INTERNAL SETTLEMENT -THIS IS USED FOR SETTLEMENT OF COST FROM

INTERNAL ORDER TO COST CENTERS ( CO TO CO ).
31. ORDER/ PROJECT RESULTS ANALYSIS-THIS IS USED FOR WORK-IN-

PROCESS CALCULATION IN PRODUCT COSTING.
41. OVERHEAD RATES -THIS IS USED FOR CALCULATION OF RAW MATERIAL

OVERHEAD RATE / PRODUCTION OVERHEAD RATE IN PRODUCT COSTING .
42. ASSESSMENT- THIS IS USED FOR ALLOCATION OF PRIMARY COST

POSTINGS AND SECONDARY COST POSTINGS FROM ONE COST CENTER TO
OTHER COST CENTERS.
43. INTERNAL ACTIVITY ALLOCATION- THIS IS USED FOR CALCULATION OF

ACTIVITY TYPES IN PRODUCT COSTING.
Eg: MACHINE HOUR RATE / LABOUR HOUR RATE IN PRODUCT

COSTING.
COST CENTER ACCOUNTING
COST CENTER ACCOUNTING HELPS US TO TRACK WHERE COSTS ARE

INCURRED IN YOUR ENTERPRISE. ALL THE COSTS SUCH AS SALARIES, WAGES,
RENT, POWER etc., INCURRED ARE EITHER ASSIGNED OR POSTED TO A COST
CENTER
WHAT IS COST CENTER :-
A COST CENTER IS AN ORGANIZATIONAL ELEMENT WITHIN A CONTROLLING

AREA.
IN CAN BE CREATED BASED ON :-
FUNCTIONAL REQUIREMENTS
ALLOCATION REQUIREMENTS
PHYSICAL LOCATION
RESPONSIBILITY FOR COSTS
IN ORGANIZATIONS THERE WILL BE NUMBER OF DEPARTMENTS E.g., -

PRODUCTION DEPARTMENTS / SERVICE DEPARTMENTS etc.,
CATEGORY
15
WHAT IS COST CENTER CATEGORY
A COST CENTER CATEGORY IS AN INDICATOR IN THE COST CENTER MASTER

RECORD THAT IDENTIFIES WHAT KIND OF ACTIVITIES A PARTICULAR COST
CENTER PERFORMS
Eg : -PRODUCTION / SERVICE /ADMINISTRATION / MARKETING etc.,

STANDARD HIERARCHY.
WHEN WE WANT TO SEE NUMBER OF COST CENTERS DATA AT A TIME WE

HAVE TO CREATE COST CENTER GROUP AND ASSIGN THE RESPECTIVE COST
CENTERS.
IN THE MONTH END WE ALLOCATE SERVICE DEPARTMENT COSTS TO

PRODUCTION DEPARTMENTS. THE BASIS OF ALLOCATION MAY BE FIXED
AMOUNT BASIS/PERCENTAGE BASIS /STATISTICAL KEY FIGURES BASIS /
ACTIVITY TYPE BASIS.
SAP HAS GIVEN 4 ALLOCATION METHODS
1. ASSESSMENT
2.DISTRIBUTION
3.PERIODIC REPOSTING AND
4.INDIRECT ACTIVITY ALLOCATION
Eg : - FI POSTING [ FB01L ]
400100 SALARIES A/C DR 200000 COST CENTER : DEPTM
400100 SALARIES A/C DR 400000 COST CENTER : DEPTN
400300 RENT ACCOUNT DR 100000 COST CENTER : DEPTM
TO 200105 BANK 700000
IT GENERATES 1 FI DOCUMENT AND 1 CO DOCUMENT

( COIN )
FI ( RECORDS ) : -
400100 SALARIES A/C

AMOUNT 600000 DR
16
400300 RENT A/C
AMOUNT 100000 DR
CO ( RECORDS ) :-
COST CENTER DEPTM
400100 SALARIES COST ELEMENT 200000 DR

400300 RENT 100000 DR
300000 DR
COST CENTER DEPTN

400100 SALARIES COST ELEMENT 400000 DR
400000 DR
STEPS FOR POSTING TO COST CENTERS : -
1. CREATION OF PRIMARY COST ELEMENTS
A . AT FI AREA
B . AT CO AREA
C . AUTOMATIC CREATION OF PRIMARY COST ELEMENTS AT THE TIME OF CO
IMPLEMENTATION
D . AUTOMATIC CREATION OF PRIMARY COST ELEMENTS AFTER CO
IMPLEMENTATION
2 . DISPLAY COST ELEMENTS CREATED

3. CREATION OF FIELD STATUS GROUP BY MAKING COST CENTER REQUIRED
ENTRY FIELD
4. ASSIGN NEW FIELD STATUS GROUP IN G/L EXPENDITURE ACCOUNTS
5. CREATION OF COST CENTERS.
6. CREATION OF COST CENTER GROUPS-TO VIEW NUMBER OF COST CENTERS

DATA AT A TIME WE CREATE COST CENTER GROUPS
7. CREATION OF COST ELEMENT GROUPS -TO VIEW NUMBER OF COST

ELEMENTS DATA AT A TIME WE CREATE COST ELEMENT GROUPS
8 .TO ENTER EXCHANGE RATE FOR TYPE " M " FOR INR TO EURO
9. POSTING OF TRANSACTION IN FI
10.DISPLAY COST CENTER REPORT.
11.TO VIEW CO DOCUMENTS
17
1 A)CREATION OF PRIMARY COST ELEMENTS AT FI AREA (T/C FS00 )
IN SOME IMPLEMENTATIONS FI CORE TEAM MEMBER AT THE TIME OF

CREATION OF EXPENDITURE ACCOUNT WILL CREATE THE SAME
EXPENDITURE ACCOUNT AS PRIMARY COST ELEMENT.
CREATED G/L EXPENDITURE ACCOUNT 400100 SALARIES ACCOUNT- TO

UPDATE CO RECORDS CREATE 400100 SALARIES ACCOUNT AS PRIMARY COST
ELEMENT
--> GL ACCOUNT NUMBER : 400100 SALARIES ACCOUNT

--> COMPANY CODE :VIL
--> ENTER
--> SELECT EDIT COST ELEMENT BUTTON OR F8
--> VALID FROM DATE : 01.04.2023
--> TO DATE : 31.12.9999 COMES AUTOMATICALLY
--> ENTER
--> G/L SHORT TEXT : COST ELEMENT NAME
--> G/L LONG TEXT : COST ELEMENT DESCRIPTION
AUTOMATICALLY
--> COST ELEMENT CATEGORY : SELECT 1 (PRIMARY COSTS / COST
REDUCING REVENUES)
--> SELECT SAVE BUTTON OR CTRL+S
1 B)CREATION OF PRIMARY COST ELEMENTS AT CO AREA
IN OTHER IMPLEMENTATIONS, FI CORE TEAM MEMBER CREATES G/L

EXPENDITURE ACCOUNT . THEN HE WILL INFORM CO-CORE TEAM MEMBER
ACCOUNT NUMBER WITH DESCRIPTION .
CO CORE TEAM MEMBER CREATES PRIMARY COST ELEMENT AT CO AREA.
FI CORE TEAM MEMBER CREATED G/L EXPENDITURE ACCOUNT 400300 RENT

ACCOUNT -HE INFORMS CO CORE TEAM MEMBER .
HOW TO CREATE PRIMARY COST ELEMENT AT CO AREA [T/C KA01 ]
PATH: ACCOUNTING --> CONTROLLING --> COST ELEMENT ACCOUNTING -->

MASTER DATA --> COST ELEMENT --> INDIVIDUAL PROCESSING --> CREATE
PRIMARY [T/C KA01 ]
--> FROM THE MENU BAR SELECT EXTRAS --> SET CONTROLLING AREA
--> CONTROLLING AREA:VIL AND ENTER
--> COST ELEMENT : 400300 RENT ACCOUNT
--> VALID FROM : 01.04.2023 TO 31.12.9999 AND ENTER
18
--> COST ELEMENT CATEGORY : 1 (PRIMARY COSTS /COST REDUCING
REVENUES)
--> SAVE
1C) AUTOMATIC CREATION OF PRIMARY COST ELEMENTS AT THE TIME OF
CO IMPLEMENTATION
VIL HAS GONE FOR SAP FI IN 2010 - THEY HAVE CREATED AROUND 1000
EXPENDITURE ACCOUNTS . IN THE YEAR 2023 THEY WANT TO GO FOR CO -
NOW ALL EXPENDITURE ACCOUNTS ARE TO BE CREATED AS PRIMARY COST
ELEMENTS TO UPDATE CO RECORDS. SAP HAS GIVEN THE FACILITY TO
CREATE ALL COST ELEMENTS BY WAY OF BATCH INPUT SESSION .
i)MAKE DEFAULT SETTINGS [T/C : OKB2]
PATH : SPRO --> CONTROLLING --> COST ELEMENT ACCOUNTING --> MASTER
DATA --> COST ELEMENTS --> AUTOMATIC CREATION OF PRIMARY AND
SECONDARY COST ELEMENTS--> MAKE DEFAULT SETTINGS [ OKB2 ] -->
CHART OF ACCOUNTS : VIL AND ENTER

--> ACCOUNT FROM : 400301
--> ACCOUNT TO : 499999
--> COST ELEMENT CATEGORY : SELECT 1
--> SAVE
--> SAVE IN YOUR REQUEST
ii. CREATE BATCH INPUT SESSION [T/C OKB3 ]
--> SAME PATH

-->CONTROLLING AREA : VIL
--> VALID FROM : 01.04.2023
--> VALID TO : 31.12.9999
-->SESSION NAME : VIL (THIS IS TEXT FIELD)
--> SELECT EXECUTE BUTTON
iii . EXECUTE BATCH INPUT SESSION [T/C SM35 ]

--> SAME PATH
--> SELECT SESSION NAME : VIL
--> SELECT PROCESS BUTTON
--> SELECT DISPLAY ERRORS ONLY RADIO BUTTON
--> SELECT PROCESS BUTTON
--> WE GET A MESSAGE PROCESSING OF BATCH INPUT SESSION COMPLETED.
--> IGNORE THE MESSAGE AND SELECT EXIT BATCH INPUT BUTTON
19
1(D). AUTOMATIC CREATION OF PRIMARY COST ELEMENTS AFTER CO
IMPLEMENTATION
FOR SOME COMPANIES , WHEN EXPENDITURE ACCOUNT IS CREATED PRIMARY
COST ELEMENT SHOULD BE CREATED AUTOMATICALLY
i) MAINTAIN CHART OF ACCOUNTS [T/C OB13 ]
--> SELECT CHART OF ACCOUNTS :VIL

--> CONTROLLING INTEGRATION : SELECT AUTOMATIC CREATION OF COST
ELEMENTS
--> SAVE AND SAVE IN YOUR REQUEST
ii) CREATION OF G/L ACCOUNT 400330 VEHICLE REPAIRS A/C [T/C FS00 ]
--> G/L A/C: 400330

--> SELECT WITH TEMPLATE BUTTON
--> G/L ACCOUNT : 400300 RENT A/C
--> ENTER
--> CHANGE SHORT TEXT AND G/L LONG TEXT TO VEHICLE REPAIRS A/C
--> SAVE
iii) MAINTAIN CHART OF ACCOUNTS [T/C OB13 ]

--> SELECT CHART OF ACCOUNTS :VIL
--> CONTROLLING INTEGRATION : SELECT MANUAL CREATION OF COST
ELEMENTS
--> SAVE
-->PRESS ENTER TO SAVE IN YOUR REQUEST
2.DISPLAY PRIMARY COST ELEMENTS CREATED [T/C KA03 ]

PATH: ACCOUNTING --> CONTROLLING --> COST ELEMENT ACCOUNTING -->
MASTER DATA --> COST ELEMENT --> INDIVIDUAL PROCESSING --> DISPLAY
--> SELECT DROP DOWN BUTTON BESIDE COST ELEMENT

--> ENTER
3.CREATION OF FIELD STATUS GROUP BY MAKING COST CENTER

REQUIRED ENTRY FIELD [T/C OBC4 ]
FOR 400100 SALARIES ACCOUNT - ASSIGNED FIELD STATUS GROUP: G001

GENERAL
20
ALSO FOR 100000 EQUITY SHARE CAPITAL A/C ASSIGNED FIELD STATUS
GROUP :G001 GENERAL
IF WE MAKE COST CENTER REQUIRED FOR FIELD STATUS GROUP G001 - FOR
EQUITY SHARE CAPITAL ALSO IT WILL ASK COST CENTER.
SAP HAS GIVEN FIELD STATUS GROUP G004 COST ACCOUNTS .
FOR FIELD STATUS GROUP : G004 - WE MAKE COST CENTER REQUIRED AND
ASSIGN NEW FIELD STATUS GROUP IN EXPENDITURE ACCOUNTS
-->SELECT FIELD STATUS VARIANT: VIL

-->DOUBLE CLICK ON FIELD STATUS GROUPS FOLDER
--> DOUBLE CLICK ON FIELD STATUS GROUP G004 COST ACCOUNTS
-->DOUBLE CLICK ON GENERAL DATA
-->TEXT SELECT REQUIRED ENTRY RADIO BUTTON
-->SELECT NEXT GROUP BUTTON
--> COST CENTER SELECT REQUIRED ENTRY FIELD
--> SELECT NEXT PAGE OR PAGE DOWN BUTTON
--> PROFIT CENTER SELECT OPTIONAL ENTRY RADIO BUTTON
--> SAVE
-->PRESS ENTER TO SAVE IN YOUR REQUEST
4 . ASSIGN NEW FIELD STATUS GROUP IN G/L EXPENDITURE ACCOUNTS

[T/C FS00]
A . G/L ACCOUNT : 400100 SALARIES ACCOUNT
--> COMPANY CODE : VIL
--> FROM THE MENU BAR SELECT G/L ACCOUNT CHANGE
--> SELECT "CREATE / BANK / INTEREST " TAB
-->FIELD STATUS GROUP CHANGE TO G004 COST ACCOUNTS
--> SAVE
B . G/L ACCOUNT : 400300 RENT A/C

--> FROM THE MENU BAR SELECT G/L ACCOUNT CHANGE
--> CHANGE FIELD STATUS GROUP TO G004 COST ACCOUNTS
--> SAVE
5. CREATION OF COST CENTERS [T/C KS01 ]

PATH: ACCOUNTING --> CONTROLLING -->COST CENTER ACCOUNTING
--> MASTER DATA --> COST CENTER --> INDIVIDUAL PROCESSING --> CREATE
--> CONTROLLING AREA : VIL AND ENTER
1ST COST CENTER :- COST CENTER : DEPTM
21
--> VALID FROM : 01.04.2023 TO 31.12.9999
--> ENTER
-->GIVE THE NAME : DEPARTMENT M
-->DESCRIPTION :COST CENTER DEPARTMENT M
--> PERSON RESPONSIBLE : MR. M
--> COST CENTER CATEGORY : SELECT 1 PRODUCTION
--> HIERARCHY AREA : SELECT VILHIER
--> CURRENCY : INR
--> PROFIT CENTER : STEEL
2ND COST CENTER : - COST CENTER : DEPTN

--> REFERENCE COST CENTER : DEPTM
-->ENTER
-->CHANGE THE NAME TO DEPARTMENT N
-->CHANGE THE DESCRIPTION TO COST CENTER DEPARTMENT N
--> OTHER FIELDS ARE COMMON SELECT SAVE BUTTON
3RD COST CENTER :- COST CENTER : DEPTO
-->REFERENCE COST CENTER : DEPTM
-->ENTER
-->CHANGE THE NAME TO DEPARTMENT O
-->CHANGE THE DESCRIPTION TO COST CENTER DEPARTMENT O
-->COST CENTER CATEGORY : SELECT TO 2 (SERVICE COST CENTER)
-->SELECT SAVE BUTTON OR CTRL+S
6 . CREATION COST CENTER GROUPS
TO VIEW NUMBER OF COST CENTERS DATA AT A TIME WE CREATE

COST CENTER GROUPS.
--> CONTROLLING AREA :VIL

COST DEPTM DEPTN DEPTO DEPTX DEPTY DEPTZ
CENTERS
CATEGORY PROD PROD SERVICE PROD PROD SERVICE
SEGMENT HYD HYD HYD BGL BGL BGL
PROFIT STEEL STEEL STEEL CEMENT CEMENT CEMENT
CENTERS
IF WE WANT TO SEE ALL COST CENTERS DATA - IN REPORT WE

GIVE COST CENTERGROUP– VILHIER
IF WE WANT TO SEE PRODUCTION COST CENTERS DATA

CREATE A COST CENTER GROUP ASSIGN DEPTM, DEPTN,
22
DEPTX AND DEPTY.
IF WE WANT TO SEE ONLY HYD LOCATION COST CENTERS

DATA -CREATE A COST CENTER GROUP AND ASSIGN
DEPTM, DEPTN AND DEPTO .
IF WE WANT TO SEE ONLY HYD LOCATION PRODUCTION COST CENTERS DATA

– CREATE A COST CENTER GROUP AND ASSIGN DEPTM AND DEPTN.
PATH : ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING -->

MASTER DATA --> COST CENTER GROUP --> CREATE [T/C KSH1 ]
--> GIVE THE CONTROLLING AREA VIL
--> ENTER
--> GIVE THE COST CENTER GROUP NAME : VILHYDPRD AND ENTER
--> DESCRIPTION : HYDERABAD PRODUCTION COST CENTERS GROUP FOR VIL
--> SELECT INSERT COST CENTER BUTTON
--> SELECT THE COST CENTERS : DEPTM AND DEPTN
--> SAVE
7. CREATION OF COST ELEMENT GROUP

TO VIEW NUMBER OF COST ELEMENTS DATA AT A TIME WE CREATE COST
ELEMENT GROUPS
IN FI WE HAVE CREATED ACCOUNT GROUPS-

PERSONNEL COST 400100 -400199
400100 SALARIES ACCOUNT
400101 WAGES ACCOUNT
400102 BONUS ACCOUNT
ADMINISTRATION COST 400300 - 400399

400300 RENT A/C
400301 PETROL EXPENSES
400302 TELEPHONE EXPENSES
REQUIREMENT IN CO :
WE WANT TO SEE DEPTM ADMINISTRATION COST
OR
DEPTN PERSONNEL COST
CREATE A COST ELEMENT GROUP PERSONNEL AND

ASSIGN COST ELEMENTS 400100 - 400199
CREATE COST ELEMENT GROUP ADMIN AND ASSIGN COST
23
ELEMENTS 400300 - 400399
IN CO REPORT :-
COST CENTER DEPTM DEPTN
OR
COST CENTER VILHIER

GROUP
COST
ELEMENT
OR
COST ADMIN PERSONNEL ADMIN

ELEMENT
GROUP
RESULT: WE GET WE GET WE GET

ADMINISTRATION PERSONNEL ADMINISTRATION
COST OF DEPTM COST OF COST OF ALL
ONLY DEPTN ONLY DEPARTMENTS
PATH: ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING -->

MASTER DATA --> COST ELEMENT GROUP -->CREATE [T/C KAH1]
--> GIVE CONTROLLING AREA :VIL AND ENTER
-->COST ELEMENT GROUP NAME : VILADMIN AND ENTER
--> DESCRIPTION : ADMINISTRATION COST ELEMENT GROUP FOR VIL
--> SELECT INSERT COST ELEMENT BUTTON (SHIFT+F4)
--> FROM COST ELEMENT 400300 TO COST ELEMENT 400399 AND SAVE
8. TO ENTER EXCHANGE RATE FOR TYPE M FOR INR TO EURO [T/C OB08]
-->SELECT NEW ENTRIES BUTTON

-->EXCHANGE RATE TYP : M (AVERAGE RATE)
-->VALID FROM : 01.04.2023
--> FROM : INR
--> DIRECT QUOTATION 0.01429
--> TO : EUR
--> SAVE
--> SELECT MAINTAIN BUTTON
-->SELECT SAVE BUTTON AND PRESS ENTER TO SAVE IN YOUR REQUEST
--> ONCE AGAIN SAVE
24
9. POSTING OF TRANSACTION IN FI [T/C FB01L ]
-->DOCUMENT DATE : TODAY’S DATE
--> TYPE : SA
--> POSTING KEY : 40
--> ACCOUNT : 400100 SALARIES ACCOUNT
--> ENTER
--> AMOUNT : 200000
--> COST CENTER : DEPTM
--> TEXT : SALARIES POSTING
--> ENTER
--> AMOUNT : 400000
--> COST CENTER : DEPTN
--> ACCOUNT : 400300 RENT ACCOUNT
--> ENTER
--> AMOUNT : 100000
--> TEXT : RENT POSTING
--> ACCOUNT : 200100 CASH ACCOUNT
--> ENTER
--> AMOUNT : *
--> TEXT : EXPENDITURE POSTING
--> FROM THE MENU BAR SELECT DOCUMENT -->SIMULATE AND SAVE
10. DISPLAY COST CENTER REPORT [T/C KSB1 ]

PATH: ACCOUNTING --> CONTROLLING -->COST CENTER ACCOUNTING -->
INFORMATION SYSTEM --> REPORTS FOR COST CENTER ACCOUNTING --> LINE
ITEMS --> COST CENTERS: ACTUAL LINE ITEMS

-->COST CENTER: SELECT DEPTM
-->SELECT EXECUTE BUTTON
--> KEEP THE CURSOR ON SALARIES ACCOUNT i.e., FIRST LINE ITEM
--> SELECT DOCUMENT BUTTON
--> SELECT CHANGE LAYOUT BUTTON (CTRL+F8)
--> ACTIVATE BUSINESS TRANSACTION
--> ACTIVATE DOCUMENT NUMBER AND
-->ACTIVATE REFERENCE DOCUMENT NUMBER FROM COLUMN SET
--> ENTER
25
11. TO VIEW CO DOCUMENTS [T/C KSB5 ]
PATH :UPTO LINE ITEMS THE PATH IS SAME
--> CO DOCUMENTS:ACTUAL COSTS

-->DOCUMENT NO : 1 TO 100000
--> SELECT DOCUMENT NO.1 FOLDER
SUMMARY : -
1 . CREATE G/L EXPENDITURE ACCOUNTS AS PRIMARY COST ELEMENTS.
2.CREATED COST CENTERS.
3.IN FIELD STATUS GROUP SPECIFIED COST CENTER REQUIRED AND ASSIGNED
NEW FIELD STATUS GROUP IN G/L EXPENDITURE ACCOUNTS.
4.AT THE TIME OF POSTING IN FI -WE HAVE GIVEN G/L EXPENDITURE
ACCOUNTS AS WELL AS COST CENTER ( COST OBJECT )
5. IT HAS UPDATED FI RECORDS AS WELL AS CO RECORDS
12. REPOST CO LINE ITEMS ( BUSINESS TRANSACTION RKU3 )
A . CREATION OF COST CENTER COMMON : [T/C KS01 ]
--> COST CENTER : COMMON

--> VALID FROM 01.04.2023 TO 31.12.9999
-->REFERENCE COST CENTER : DEPTM
--> CO AREA :VIL
--> ENTER
--> CHANGE THE NAME TO DEPARTMENT COMMON
--> CHANGE DESCRIPTION TO COST CENTER DEPARTMENT COMMON
--> SAVE
B . POSTING OF SALARIES IN FI [T/C FB01L ]
--> DOCUMENT DATE : TODAY'S DATE

--> TYPE : SA
--> COMPANY CODE: VIL
--> ENTER
--> AMOUNT : 100000
--> COST CENTER : COMMON
--> ENTER
--> AMOUNT : *
26
--> TEXT : +
--> FROM THE MENU BAR SELECT DOCUMENT--> SIMULATE AND SAVE
C . REPOST CO LINE ITEMS [T/C KB61]

PATH: ACCOUNTING --> CONTROLLING -->COST CENTER ACCOUNTING -->
ACTUAL POSTINGS --> REPOST LINE ITEMS -->ENTER
-->DOCUMENT NO : SELECT FROM DROP DOWN BUTTON

-->COMPANY CODE : VIL
-->FISCAL YEAR : 2023
--> DOUBLE CLICK ON LINE ITEM NO:001
--> AMOUNT UNDER NEW ACCOUNT ASSIGNMENT 50000
--> SELECT NEXT ITEM BUTTON OR SHIFT +F11
--> SELECT NEXT BUTTON
--> AMOUNT UNDER NEW ACCOUNT ASSIGNMENT 30000
--> SELECT NEXT ITEM BUTTON
--> SELECT NEXT BUTTON
--> COST CENTER UNDER NEW ACCOUNT ASSIGNMENT DEPTO
--> SAVE
D . TO VIEW COST CENTER REPORT [T/C KSB1 ]

-->COST CENTER : COMMON
-->SELECT EXECUTE BUTTON
--> SELECT CHANGE LAYOUT BUTTON
--> ACTIVATE BUSINESS TRANSACTION ,DOCUMENT NUMBER , REFERENCE
DOCUMENT NUMBER AND CO PARTNER OBJECT NAME
--> ENTER
--> COST CENTER : DEPT M
13. REPOST COSTS (BUSINESS TRANSACTION RKU1) [T/C KB11N ]

ACTUAL POSTINGS-->MANUAL REPOSTING OF COSTS --> ENTER [T/C KB11N]
--> COST CENTER (OLD) : DEPTM

--> COST ELEMENT 400100 SALARIES A/C
--> AMOUNT : 75000
--> COST CENTER (NEW) : DEPTO
--> COST CENTER (OLD) : DEPTM
--> COST ELEMENT : 400300 RENT
--> AMOUNT : 20000
27
--> COST CENTER (NEW) : DEPTO
--> ENTER
--> SELECT SAVE BUTTON OR CTR+S
14. TO VIEW COST CENTER REPORT [T/C KSB1 ]

--> ACTIVATE BUSINESS TRANSACTION, DOCUMENT NUMBER AND REF . DOC
NO FROM COLUMN SET
--> ENTER
TO VIEW COST ELEMENTWISE TOTAL:
-->SELECT COST ELEMENT COLUMN
-->SELECT SUB-TOTALS BUTTON OR CTRL+SHIFT+F6
-->SELECT COLLAPSE SELECTION OR CAP BUTTON
-->SELECT EXPAND SELECTION OR CAP BUTTON FOR COST ELEMENT 400100
SALARIES ACCOUNT
15 . PERIOD LOCK
FI PERIODS - TO POST ENTRIES THE PERIODS SHOULD BE OPEN IN FI [T/C

OB52 ]
CO PERIODS - BY DEFAULT THE PERIODS ARE OPEN. IF WE DO NOT WANT TO

POST WE HAVE TO LOCK .
FI PERIODS CO PERIODS
A) TRANSACTIONS WHICH TO OPEN NOT TO LOCK

EFFECT BOTH FI AND CO
Eg: COIN- CO THROUGH

POSTINGS FROM FI
B) TRANSACTIONS WHICH NO CHECK NOT TO LOCK

EFFECT ONLY CO
Eg: - RKU3 -REPOST CO LINE

ITEMS / RKU1- REPOST COSTS
C) TRANSACTIONS WHICH TO OPEN NO CHECK

EFFECT ONLY FI
Eg : -DEBIT BALANCE SHEET

AND CREDIT BALANCE SHEET
( EQUITY SHARE CAPITAL
28
RECEIPT )
Eg : - OPENED PERIODS FROM APR ,23 TO LOCKED APR,23
MARCH,24 IN FI PERIOD IN CO
WE WANT TO POST TO AN EXPENDITURE ACCOUNT IN FI WITH APR,23 DATE.

SYSTEM WILL NOT PERMIT IN FI SINCE CO PERIOD IS LOCKED.
PATH: ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING -->

ENVIRONMENT --> PERIOD LOCK --> CHANGE [T/C OKP1]
-->CONTROLLING AREA : [ VIL ]

--> FISCAL YEAR : [ 2023 ]
--> SELECT ACTUAL BUTTON
--> TO LOCK APRIL CO PERIODS SELECT 01 COLUMN
-->SELECT LOCK PERIOD BUTTON
--> SAVE
TO UNLOCK PERIOD : -
--> SELECT PERIOD 01 COLUMN
--> SELECT UNLOCK PERIOD BUTTON
--> IGNORE THE MESSAGE AND ENTER
--> SAVE
16. SET CONTROLLING AREA [T/C OKKS ]
PATH : - UPTO ENVIRONMENT THE PATH IS SAME
--> SET CONTROLLING AREA
--> GIVE THE CONTROLLING AREA : VIL AND ENTER
17 . ONLINE RECONCILIATION LEDGER OR REALTIME INTEGRATION OF

CONTROLLING WITH FI
THIS IS USED IN 2ND SCENARIO i.e.,: NUMBER OF COMPANY CODES HAVING
ONE CONTROLLING AREA.
ALL COMPANY CODES SHOULD USE SAME CHART OF ACCOUNTS.
DUE TO ONLINE RECONCILIATION LEDGER A DOCUMENT WILL BE

GENERATED IN FI .
Eg:
CONTROLLING AREA VIL
COST DEPTM DEPTN DEPTO DEPTX DEPTY DEPTZ
CENTERS
COMPANY VIL VIL VIL VSL VSL VSL
CODE
29
I . SALARIES POSTING IN COMPANY CODE VIL
SALARIES A/C DR 200000 COST CENTER DEPTM

TO BANK 200000
II . FI RECORDS
COMPANY CODE : VIL COMPANY CODE : VSL
SALARIES A/C SALARIES A/C

200000 NIL
III . CO RECORDS
COMPANY CODE VIL COMPANY CODE VSL
COST CENTER DEPTM COST CENTER DEPTX
SALARIES A/C 200000DR SALARIES NIL
IV . DEPTM STAFF ARE WORKING FOR DEPTX ALSO. TRANSFER Rs . 50000 /-

FROM DEPTM TO DEPTX ( REPOST COST-KB11N)
NO FI DOCUMENT
ONLY CO DOCUMENT
V . FI RECORDS
SALARIES A/C 200000DR SALARIES : VIL
VI . CO RECORDS

SALARIES A/C 200000DR SALARIES FROM M 50000DR
LESS:- TRN TO X 50000 CR
150000 DR
VII . DUE TO ONLINE RECONCILIATION LEDGER FI DOCUMENT WILL BE
GENERATED AUTOMATICALLY
FI DOCUMENT :
VIL COMPANY CODE VSL COMPANY CODE
VSL A/C DR 50000 SALARIES A/C DR 50000

TO SALARIES 50000 TO VIL 50000
VIII . FI RECORDS
30
SALARIES ACCOUNT SALARIES ACCOUNT
SALARIES A/C 200000 DR SALARIES A/C 50000 DR

SALARIES A/C 50000 CR
150000 DR 50000 DR
IX . CO RECORDS

SALARIES A/C 200000DR SALARIES FROM M 50000DR
LESS:- TRN TO X 50000 CR
150000 DR
INTERVIEW QUESTION : -
WHAT IS THE DIFFERENCE IN RECONCILIATION LEDGER IN ECC6 AS

COMPARED TO 4.7EE (OLD VERSION)
4.7EE VERSION- RUN IN THE MONTH END AS A BATCH

ECC6 VERSION- ONLINE IT POSTS THE ENTRIES
IN S/4 HANA FINANCE REMOVED ONLINE RECONCILIATION LEDGER
FI CUSTOMIZATION STEPS :-
1 . TO COPY COMPANY CODE VIL CUSTOMIZATION INCLUDING ACCOUNTS

TO COMPANY CODE VSL [T/C EC01 ]
PATH :SPRO --> ENTERPRISE STRUCTURE --> DEFINITION --> FINANCIAL

ACCOUNTING --> EDIT, COPY, DELETE, CHECK COMPANY CODE
--> DOUBLE CLICK ON COPY, DELETE, CHECK COMPANY CODE
--> FROM THE MENU BAR SELECT ORGANIZATIONAL OBJECT --> COPY
ORGANIZATIONAL OBJECT
--> FROM COMPANY CODE : VIL
--> TO COMPANY CODE : VSL
--> ENTER
--> SELECT YES BUTTON
--> SELECT NO BUTTON
--> WE GET A MESSAGE CERTAIN DATA WAS NOT COPIED
--> IGNORE THE MESSAGES AND ENTER
31
--> SELECT CREATE REQUEST BUTTON
--> SHORT DESCRIPTION : CUSTOMIZATION FOR VSL
--> SAVE
--> PRESS ENTER TO SAVE IN YOUR REQUEST
--> PRESS ENTER
--> GO ON PRESS ENTER
--> ENTER ONCE AGAIN
--> SELECT CANCEL BUTTON
--> SELECT COPY BUTTON
--> GO ON PRESS ENTER TILL YOU GET THE MESSAGE - COMPANY CODE VIL
COPIED TO VSL WITHOUT 1 NUMBER RANGE OBJECT
--> IGNORE THE MESSAGE PRESS ENTER
--> DOUBLE CLICK ON EDIT COMPANY CODE DATA
--> SELECT POSITION BUTTON
--> COMPANY CODE : VSL
--> ENTER
--> SELECT COMPANY CODE : VSL
--> CHANGE THE COMPANY NAME TO : VARUN STEELS LIMITED
--> SELECT ADDRESS BUTTON
--> CHANGE THE NAME VARUN STEELS LTD
--> ENTER
--> SAVE AND SAVE IN YOUR REQUEST BUTTON
2. ASSIGN COMPANY CODE TO COMPANY [T/C OX16 ]
PATH :
SPRO --> ENTERPRISE STRUCTURE --> ASSIGNMENT -->FINANCIAL
ACCOUNTING --> ASSIGN COMPANY CODE TO COMPANY
-->SELECT POSITION BUTTON
-->COMPANY CODE : VIL
-->ENTER
-->FOR COMPANY CODE : VSL- ASSIGN COMPANY: WGP (GROUP CODE)
--> SAVE
3. DOCUMENT TYPE SA SHOULD ALLOW INTER COMPANY POSTINGS [T/C

OBA7 ]
--> SELECT TYPE : SA
--> SELECT INTER COMPANY POSTINGS CHECK BOX
--> SAVE
4. CREATION OF GENERAL LEDGER MASTERS [T/C FS00]
32
COMPANY CODE [ VIL ] COMPANY CODE [ VSL ]
I . CO -FI RECONCILIATION A/C I . CO -FI RECONCILIATION A/C

( ANY EXPENDITURE GROUP - IT
( ANY EXPENDITURE GROUP - IT
SHOULD NOT BE A COST ELEMENT. NO
SHOULD NOT BE A COST ELEMENT. NO POSTINGS IN THIS ACCOUNT)
POSTINGS IN THIS ACCOUNT )
400150 -CO -FI RECONCILIATION A/C
400150 -CO -FI RECONCILIATION A/C
( PERSONNEL COST ACCOUNT GROUP )
( PERSONNEL COST ACCOUNT GROUP )
2)VARUN STEELS LIMTIED 2) VARUN INDUSTRIES LIMITED

( CURRENT ASSETS, LOANS & ( CURRENT ASSETS, LOANS &
ADVANCES ACCOUNT GROUP) ADVANCES ACCOUNT GROUP)
200160 – VARUN STEELS LIMITED 200161 VARUN INDUSTRIES LIMITED
WHEN WE USE SAME CHART OF ACCOUNTS, ACCOUNT NUMBER AND

DESCRIPTION SHOULD BE SAME IN ALL THE COMPANY CODES.
IF WE CREATE ACCOUNT NO.200160 – IN COMPANY CODE VSL IT GIVES

DESCRIPTION VARUN STEELS LIMITED. IN OUR COMPANY CODE WE WILL NOT
CREATE OUR ACCOUNT. WE HAVE TO CREATE VARUN INDUSTRIES LIMITED
ACCOUNT.
IF WE CREATE ACCOUNT 200161 IN COMPANY CODE VIL -IT GIVES

DESCRIPTION VARUN INDUSTRIES LIMITED -IN OUR COMPANY CODE WE WILL
NOT CREATE OUR ACCOUNT. WE HAVE TO CREATE VARUN STEELS LIMITED
ACCOUNT.
1st G/L A/C : -
-->G/L ACCOUNT NO : 400150

-->SELECT WITH TEMPLATE BUTTON
-->G/L ACCOUNT NO: 400100 SALARIES ACCOUNT
--> COMPANY CODE: VIL
-->ENTER
--> CHANGE SHORT TEXT AND G/L ACCOUNT LONG TEXT TO: CO- FI
RECONCILIATION ACCOUNT
--> SELECT CREATE / BANK /INTEREST TAB
--> FIELD STATUS GROUP CHANGE TO ICCF [ CO < -> FI RECONCILIATION
POSTING]
--> SAVE
2nd G/L ACCOUNT :-
-->G/L ACCOUNT NO : 200160
33
--> GL ACCOUNT NO: 200120 INVENTORY RM
--> ENTER
--> FIELD STATUS GROUP : G067 RECONCILATION ACCOUNTS
--> SELECT TYPE/DESCRIPTION TAB
--> CHANGE SHORT TEXT AND G/L ACCOUNT LONG TEXT: VARUN STEELS
LIMITED
--> SAVE
3rd G/L ACCOUNT:-

-->G/L ACCOUNT NO.: 400150
--> G/L ACCOUNT : 400150
--> COMPANY CODE :VIL
--> ENTER AND SAVE
4th G/L ACCOUNT: -

-->G/L ACCOUNT NO: 200161
--> G/L ACCOUNT : 200160
--> ENTER
--> CHANGE SHORT TEXT AND G/L LONG TEXT TO: VARUN INDUSTRIES
LIMITED
--> SAVE
5. ASSIGNMENT OF ACCOUNTS FOR AUTOMATIC POSTING :[ T/C OBYA ]

PATH :SPRO --> FINANCIAL ACCOUNTING( NEW ) --> GENERAL LEDGER
ACCOUNTING( NEW ) --> BUSINESS TRANSACTIONS --> PREPARE CROSS
COMPANY CODE TRANSACTIONS
--> COMPANY CODE 1 :VIL
--> COMPANY CODE2 : VSL
--> ENTER
--> UNDER COMPANY CODE 1
-->POSTED IN : VIL
--> CLEARED AGAINST: VSL
--> DEBIT POSTING KEY :40
-->ACCOUNT DEBIT : 200160 ( VARUN STEELS LIMITED )
--> CREDIT POSTING KEY : 50
--> ACCOUNT CREDIT : 200160 (VARUN STEELS LIMITED)
--> UNDER COMPANY CODE 2
--> POSTED IN :VSL
--> CLEARED AGAINST : VIL
--> DEBIT POSTING KEY : 40
-->ACCOUNT DEBIT : 200161 [ VARUN INDUSTRIES LIMITED ]
--> CREDIT POSTING KEY : 50
--> ACCOUNT CREDIT : 200161
34
--> SAVE
6. TO MAKE TEXT FIELD OPTIONAL ENTRY FIELD FOR FIELD STATUS

GROUP G004 i.e., : COST ACCOUNTS :
[ T/C OBC4 ]
--> SELECT FIELD STATUS VARIANT VIL
--> DOUBLE CLICK ON FIELD STATUS GROUPS FOLDER
--> DOUBLE CLICK ON G004 i.e., COST ACCOUNTS
--> DOUBLE CLICK ON GENERAL DATA
--> TEXT SELECT OPTIONAL ENTRY RADIO BUTTON
--> SAVE AND PRESS ENTER SAVE IN YOUR REQUEST
CO - CUSTOMIZATION
1. MAINTAIN CONTROLLING AREA:[ T/C OKKP ]
--> SELECT CONTROLLING AREA : VIL

--> COMPANY CODE TO CONTROLLING AREA: SELECT CROSS COMPANY CODE
COST ACCOUNTING
--> RECONCILIATION LEDGER DOCUMENT TYPE : SA i.e., GL ACCOUNT
DOCUMENT
--> SAVE
--> DOUBLE CLICK ON ACTIVATE COMPONENTS / CONTROL INDICATORS
FOLDER
--> SELECT COMPANY CODE VALIDATION CHECK BOX
--> DOUBLE CLICK ON ASSIGNMENT OF COMPANY CODE(S) FOLDER
--> SELECT COMPANY CODE : VIL
--> SELECT COPY AS BUTTON
--> CHANGE THE COMPANY CODE TO VSL
--> ENTER AND SAVE
--> IGNORE THE WARNING MESSAGE PRESS ENTER
2. ACTIVATE RECONCILIATION LEDGER :[ T/C KALA ]

PATH:SPRO --> CONTROLLING --> COST ELEMENT ACCOUNTING -->
RECONCILIATION LEDGER --> ACTIVATE/ DEACTIVATE RECONCILIATION
LEDGER
-->DOUBLE CLICK ON ACTIVATE RECONCILIATION LEDGER

--> DOCUMENT TYPE : SA
--> IGNORE THE WARNING MESSAGE PRESS ENTER
3. DEFINE ADJUSTMENT ACCOUNTS FOR RECONCILIATION POSTING [T/C :

OK17 ]
--> SAME PATH
35
--> DOUBLE CLICK ON DEFINE ACCOUNTS FOR AUTOMATIC POSTINGS
--> SELECT CHANGE ACCOUNT DETERMINATION BUTTON
--> SAVE
--> ACCOUNT NO.:400150 i.e., CO/FI RECONCILIATION A/C
--> SAVE
ECC6 CUSTOMIZATION :-
1. DEFINE VARIANTS FOR REALTIME INTEGRATION
PATH :SPRO --> FINANCIAL ACCOUNTING (NEW) --> FINANCIAL ACCOUNTING

GLOBAL SETTINGS (NEW) --> LEDGERS --> REALTIME INTEGRATION OF
CONTROLLING WITH FINANCIAL ACCOUNTING --> DEFINE VARIANTS FOR
REAL TIME INTEGRATION
-->SELECT NEW ENTRIES BUTTON

-->VARIANT FOR REALTIME INTEGRATION :V1
--> SELECT REALTIME INTEGRATION : ACTIVE CHECK BOX
--> KEY DATE : ACTIVE FROM : 01.04.2023
--> SELECT ACCOUNT DETERMINATION : ACTIVE CHECK BOX
--> TEXT : VARIANT FOR VIL
--> SELECT CROSS COMPANY CODE CHECK BOX
--> SELECT CROSS PROFIT CENTER CHECK BOX
--> SELECT CROSS SEGMENT CHECK BOX
--> SELECT CROSS COST CENTER CHECK BOX
--> SAVE
2. ASSIGN VARIANTS FOR REALTIME INTEGRATION TO COMPANY CODES

-->SAME PATH
COMPANY CODE VARIANT FOR REALTIME INTEGRATION

VIL V1
VSL V1
--> SAVE
END USER AREA : -

1. CREATION OF COST CENTER DEPTX FOR COMPANY CODE VSL :[ T/C
KS01 ]
--> COST CENTER : DEPTX
--> VALID FROM : 01.04.2023
--> TO DATE : 31.12.9999
36
--> ENTER
--> CHANGE THE NAME TO : DEPARTMENT X
--> CHANGE THE DESCRIPTION TO COST CENTER DEPT X
--> CHANGE COMPANY CODE TO : VSL
2. REPOST COSTS [T/C : KB11N ]

-->COST CENTER (OLD) : DEPTM
--> COST ELEMENT : 400100 SALARIES
--> AMOUNT : 50000
--> COST CENTER (NEW): DEPTX
--> SAVE
3. TO VIEW FI DOCUMENTS: [T/C FB03 ]

-->SELECT DOCUMENT LIST BUTTON
--> ENTRY DATE : TODAY’S DATE
--> DOUBLE CLICK ON DOCUMENT NO.
--> SELECT BACK ARROW 2 TIMES
--> CHANGE THE COMPANY CODE TO : VSL
--> DOUBLE CLICK ON DOCUMENT NO.1
SUMMARY : -
A. REPOST COST ONLY IN ONE COMPANY CODE
[T/C KB11N ]
--> COST CENTERS DEPT M DEPT O
TRANSFER COST
NO FI DOCUMENT
ONLY CO DOCUMENT
B . REPOST COST -DIFFERENT COMPANY CODES UNDER SAME

CONTROLLING AREA - USING SAME CHART OF ACCOUNTS [T/C : KB11N ]
CONTROLLING AREA : VIL

COMPANY CODE : VIL VSL
COST CENTER : DEPTM DEPTX
TRANSFER COST
1 FI DOCUMENT 1 FI DOCUMENT
1 CO DOCUMENT
C . IN NORMAL ACCOUNTING OR IF ONLINE RECONCILATION LEDGER IS NOT
ACTIVATED IN SAP OR USING DIFFERENT CHART OF ACCOUNTS:
37
WHEN WE TRANSFER COST FROM ONE COMPANY CODE DEPT TO OTHER
COMPANY CODE DEPARTMENT
VIL RAISES A DEBIT NOTE ON VSL IN FI [FB01L ]
VIL COMPANY CODE: VSL COMPANY CODE:
VSL DR 50000 SALARIES DR 50000 DEPTX
TO SALARIES 50000-DEPTM TO VIL 50000
CROSS COMPANY CODE TRANSACTIONS ( FI AREA )
ONE COMPANY CODE EXPENDITURE PAID BY DIFFERENT COMPANY CODE i.e.,

VIL TO VSL OR VICE VERSA
ONE COMEPANY CODE VIL MAKES PAYMENT TO DIFFERENT COMPANY CODE

VSL VENDOR OR VICE VERSA.
ONE COMPANY CODE VIL CUSTOMER MAKES PAYMENT TO DIFFERENT

COMPANY CODE VSL OR VICE VERSA.
AUTOMATIC PAYMENT PROGRAM RUN FOR CROSS COMPANY CODES. IN

COMPANIES CENTRALIZED PAYMENTS i.e.,:- PAYMENT TO ALL COMPANY
CODES VENDORS FROM ONE COMPANY CODE
COMPANY CODE : VIL VSL
OUTSTANDING EXPENSES OF VSL PAID BY VIL
NORMAL ACCOUNTING :-
VIL COMPANY CODE: VSL COMPANY CODE:
VSL DR 10000 OUTSTANDING DR 10000
TO CASH 10000 TO VIL 10000
IN SAP : PAYING COMPANY CODE : VIL
CREDIT CASH VIL 10000

DEBIT OUSTANDING EXP . VSL 10000
--> SAVE
RESULT:
IN VIL COMPANY CODE: VSL ACCOUNT WILL BE DEBITED AND IN VSL
COMPANY CODE: VIL ACCOUNT WILL BE CREDITED AUTOMATICALLY.
--> USE TRANCTION CODE: FB01L
--> DOCUMENT DATE: TODAY’S DATE
38
--> TYPE : SA
--> COMPANY CODE:VIL
--> ENTER
--> AMOUNT : 10000
--> TEXT : OUTSTANDING EXPENSES PAYMENT ON BEHALF OF VSL
--> ACCOUNT : 100500 OUTSTANDING EXPENSES
--> NEW COMPANY CODE : VSL
--> ENTER
--> AMOUNT : *
--> TEXT : +
--> SELECT CONTINUE BUTTON
IT GENERATES CROSS COMPANY CODE NO. 0000000023VIL 23
IF DOCUMENT IS POSTED BY VIL :

CROSS COMPANY CODE NO. 0000000023VIL 23
IF DOCUMENT IS POSTED BY VSL :
CROSS COMPANY CODE NO. 0000000002VSL 23
WHY COST CENTERS ARE REQUIRED :-
INDIAN ACCOUNTING STANDARD 2 ( AS2 ) - PRODUCTION OR STOCK

VALUATION AT COST OR MARKET PRICE WHICHEVER IS LOWER. COST MEANS
UPTO MANUFACTURING COST .
FI :-
WAGES A/C DR 100000

TO BANK 100000
WE DO NOT KNOW HOW MUCH TO ALLOCATE COST TO EACH DEPARTMENT
PRODUCTION. IF WE ALLOCATE COST EQUALLY AMONG ALL DEPRTMENTS
PRODUCTION ALLOCATION OF COST IS WRONG.WE ARE GIVING COST
CENTERS ALSO AT THE TIME OF FI POSTING
FI : -
WAGES A/C DR 100000 COST CENTER
DEPTM 50000
COST CENTER
DEPTN 30000
39
COST CENTER
DEPTO 20000
TO BANK 100000
CO:
DEPTO DEPTM DEPTN

(SERVICE (PRODUCTION DEPARTMENTS)
DEPT)
WAGES 20000 WAGES 50000 WAGES 30000
LESS: ADD: ADD:
ALLCN M -15000 ALLCN O 15000 ALLCN 5000
O
ALLCN N - 5000
TOTAL 0 65000 35000
PRODUCTION  FG1  1000 FG3 3000
(IN KGS)  FG2 2000 FG2 4000
IN THE MONTH END ALLOCATION OF COST OF EACH DEPARTMENT TO
PRODUCTION PRODUCED IN THE RESPECTIVE DEPARTMENTS BASED ON
MACHINE HOURS TAKEN. THEN COST ALLOCATION IS CORRECT .
STATISTICAL KEY FIGURES (SKF)
THIS IS USED AS A BASIS FOR ALLOCATION OF COSTS FROM ONE COST

CENTER TO OTHER COST CENTERS.
Eg : - EMPLOYEE / AREA/ TELEPHONE CALLS
COST CENTER DEPTO DEPTM DEPTN
(SERVICE COST CENTER) (PRODUCTION COST CENTERS )
SALARIES 100000 BASED ON NO.OF EMPLOYEES

RENT 20000 BASED ON SQ.METER AREA
TELEPHONE 30000 BASED ON NO. OF TELEPHONE CALLS
EXPENSES
DEFINE CO NO. RANGE INTERVAL FOR BUSINESS TRANSACTION RKS i.e., :
(ENTER STATISTICAL KEY FIGURES)
SKF CATEGORY : FIXED VALUES
:TOTAL VALUES
FIXED VALUES : - IF WE SELECT FIXED VALUES, THE VALUES ARE COMMON
FOR ALL PERIODS IN THE YEAR IF WE DO NOT CHANGE IN BETWEEN.
Eg : -NO.OF EMPLOYEES / AREA
40
TOTAL VALUES: - IF WE SELECT TOTAL VALUES, WE HAVE TO ENTER VALUES
FOR EACH AND EVERY MONTH IN THE YEAR
Eg :- TELEPHONE CALLS
FIXED VALUES TOTAL VALUES
DEPTM NO. OF EMPLOYEES NO. OF

TELEPHONE
CALLS
APR,23 100 100 APR,23 50000
MAY,23 | | MAY,23 45000
JUNE,23 | | JUNE,23 46000
JULY,23 | | JULY,23 47000
AUG,23 | | AUG,23 51000
SEP,23 | | SEP,23 48000
OCT,23 | | OCT,23 50000
NOV,23 | | NOV,23 49000
DEC,23 | 150 DEC,23 47500
JAN,24 | | JAN,24 48500
FEB,24 | | FEB,24 49500
MAR,24 | | MAR,24 50500
STEPS :-
1. DEFINE CO NO RANGE INTERVAL FOR BUSINESS TRANSACTION RKS-i.e., :

ENTER STATISTICAL KEY FIGURES [ T/C KANK ]

--> KEEP THE CURSOR ON RKS
--> SELECT ELEMENT/GROUP BUTTON
--> KEEP THE CURSOR ON NUMBER RANGE 01
--> ENTER AND SAVE
2. CREATION OF STATISTICAL KEY FIGURES
41
MASTER DATA --> STATISTICAL KEY FIGURES --> INDIVIDUAL PROCESSING -->
CREATE (T/C : KK01)

--> ENTER
--> STATISTICAL KEY FIGURE : EMP
--> ENTER
--> NAME : EMPLOYEE
--> STATISTICAL KEY FIGURE UNIT OF MEASUREMENT : SELECT EA i.e., EACH
--> KEY FIGURE CATEGORY :SELECT FIXED VALUES RADIO BUTTON
--> SAVE
3. ENTER STATISTICAL KEY FIGURES

ACTUAL POSTINGS --> STATISTICAL KEY FIGURES --> ENTER [T/C : KB31N ]
RECEIVER COST STATISTICAL KEY TOTAL QUANTITY

CENTER FIGURE
DEPTM EMP 100
DEPTN EMP 25
--> SAVE
ACTIVITY TYPES ARE ACTIVITIES PROVIDED BY A COST CENTER. THEY ARE

MEASURED IN UNIT OF TIME OR QUANTITY. ACTIVITY QUANTITIES ARE
VALUED USING A PRICE .
Eg : -ALLOCATION OF COST FROM ONE COST CENTER TO OTHER COST

CENTERS OR ALLOCATION OF COST FROM ONE COST CENTER TO PRODUCTION
ORDERS USING ACTIVITY TYPES.
ACTIVITY TYPE IS NOTHING BUT FOR CONVERTING FROM ONE MATERIAL TO

ANOTHER HOW MUCH TIME IT HAS TAKEN AND HOW MUCH COST IT HAS
INCURRED . THE ACTIVITY COST IS CALLED CONVERSION COST.
Eg:- MACHINE HOUR /LABOUR HOUR
Eg1- ALLOCATION OF COST FROM ONE COST CENTER TO OTHER COST

CENTERS BY USING ACTIVITY TYPES
COST CENTER DEPTO

( SERVICE DEPT -LABOUR COST CENTER )
WAGES 400000
OVERTIME WAGES 200000
BONUS 70000
42
WORKERS WELFARE 50000
-----------
TOTAL == 720000
WORKERS -100 WORKERS FOR EACH SHIFT
- WORKING FOR 3 SHIFTS
-LABOUR HOURS ( ACTIVITY TYPE ) AVAILABLE FOR THE MONTH
100 WORKERS *3 SHIFTS * 8 HRS * 30 DAYS = 100 *3*8*30 = 72000 LABOUR

HOURS
LABOUR HOUR RATE 720000 / 72000 = 10
DEPTM DEPTN
LABOUR HOURS USED 50000 HRS 22000 HRS
LABOUR HOUR RATE 10 10
COST ALLOCATION 500000 220000

FROM DEPTO
Eg 2 : - ALLOCATION OF COST FROM ONE COST CENTER TO PRODUCTION

ORDERS .
DEPTM ( PRODUCTION DEPT )

STORES & SPARES 100000
WAGES ( ALLOCATION FROM O ) 500000
POWER 300000
TOTAL == 900000
MACHINES IN DEPTM - 50 MACHINES

WORKING FOR 3 SHIFTS
NO.OF DAYS WORKED - 30 DAYS
MACHINE HOURS ( ACTIVITY TYPE ) AVAILABLE :
50 MACHINES * 3SHIFTS * 8 HRS PER SHIFT * 30 DAYS = 36000 HOURS
MACHINE HOUR RATE 900000 / 36000 = 25
43
PRODUCTION ORDER1 ORDER2 ORDER3 TOTAL
ORDER
MACHINE 10000 20000 6000 36000

HOURS USED
MACHINE 25 25 25 25
HOUR RATE
ALLOCATION 250000 500000 150000 900000

OF COST FROM
DEPTM TO
PRODUCTION
ORDERS
THIS IS CALLED ACTIVITY BASED COSTING
DIFFERENCE BETWEEN STATISTICAL KEY FIGURES AND ACTIVITY TYPES
STATISTICAL KEY FIGURES : BASED ON NUMBER OF WORKERS
Eg: 100 WORKERS PER SHIFT - 3 SHIFTS

TOTAL 300 WORKERS
ACTIVITY TYPE : BASED ON NUMBER OF WORKERS HOURS USED .

Eg : - 100 WORKERS PER SHIFT - 3 SHIFTS
90 WORKERS WORKED FOR 30 DAYS 90 * 8 HRS *30DAYS *3SHIFTS = 64800
10 WORKERS WORKED FOR 29 DAYS 10 *8HRS * 29 DAYS *3 SHIFTS = 6960
TOTAL LABOUR HOURS = 71760
ACTIVITY TYPE PLANNING
1. ACTIVITY INDEPENDENT PLANNING AND ACTIVITY DEPENDENT PLANNING
WE WANT TO CALCULATE PLAN ACTIVITY PRICE=

PLAN COST CENTER COST/ PLAN ACTIVITY HOURS IN COST CENTER
44
SAP HAS GIVEN 2 METHODS-
ACTIVITY INDEPENDENT PLANNING ACTIVITY DEPENDENT PLANNING
A . IT COVERS BOTH PRIMARY AND A. IT COVERS BOTH PRIMARY AND

SECONDARY COST - IT DOES NOT SECONDRY COST -IT REFERS TO A
REFER TO A SPECIFIC ACTIVITY SPECIFIC ACTIVITY
B . WE CAN PLAN ONLY FIXED COST B. WE CAN PLAN FIXED AND

VARIABLE COST
1st METHOD - ACTIVITY INDEPENDENT PLANNING
1. CREATION OF SECONDARY COST ELEMENT i.e.,: - ACTIVITY ALLOCATION
PATH : ACCOUNTING --> CONTROLLING --> COST ELEMENT ACCOUNTING -->

MASTER DATA --> COST ELEMENT --> INDIVIDUAL PROCESSING --> CREATE
SECONDARY [T/C KA06 ]
--> CONTROLLING AREA :VIL ENTER

--> COST ELEMENT : 900000 ( ANY NUMBER OTHER THAN G/L ACCOUNT
NUMBER )
--> VALID FROM: 01.04.2023
--> ENTER
--> NAME : ACTIVITY ALLOCATION
--> DESCRIPTION : ACTIVITY ALLOCATION
--> COST ELEMENT CATEGORY : SELECT 43 INTERNAL ACTIVITY ALLOCATION
--> SAVE
2. CREATION OF ACTIVITY TYPE i.e., LABOUR HOURS
ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING --> MASTER

DATA --> ACTIVITY TYPE --> INDIVIDUAL PROCESSING --> CREATE [ T/C
KL01]
--> ACTIVITY TYPE :VIL1

--> ENTER
--> NAME AND DESCRIPTION : LABOUR HOURS
--> ACTIVITY UNIT : SELECT H i.e., HOUR
--> COST CENTER CATEGORIES : SELECT * i.e., ALL COST CENTER CATEGORIES
--> ACTIVITY TYPE CATEGORY : SELECT 1 i.e., MANUAL ENTRY - MANUAL
ALLOCATION
--> ALLOCATION COST ELEMENT : SELECT 900000 ACTIVITY ALLOCATION
--> PRICE INDICATOR : SELECT 1 PLAN PRICE-AUTOMATICALLY BASED ON
ACTIVITY
--> ACTUAL ACTIVITY PRICE INDICATOR : SELECT 5 ACTUAL PRICE -
AUTOMATICALLY BASED ON ACTIVITY
45
--> SAVE
3. CREATION OF COST CENTER GROUP [ KSH1 ]

--> COST CENTER GROUP : VILOGRP
--> ENTER
--> DESCRIPTION : COST CENTER GROUP VILO GROUP
--> SELECT THE COST CENTER : DEPTO
--> SAVE
4. PLANNING COST CENTERWISE (INPUT PLANNING )

PATH :ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING -->
PLANNING --> COST AND ACTIVITY INPUTS --> CHANGE (KP06)
--> VERSION : SELECT 0 i.e., PLAN / ACTUAL VERSION

--> FROM PERIOD :9(DEC)
--> TO PERIOD : 9(DEC)
--> FISCAL YEAR : 2023
--> COST CENTER : DEPTO
--> ACTIVITY TYPE : BLANK
--> COST ELEMENT FROM : 400000
--> COST ELEMENT TO : 499999
IF WE SELECT FREE RADIO BUTTON IF WE SELECT FORM BASED RADIO
BUTTON
AT THE TIME OF PLANNING NO COST AT THE TIME OF PLANNING COST

ELEMENT IS AVAILABLE. ELEMENTS LIST IS AVAILABLE .
WE HAVE TO SELECT COST ELEMENTS WE CAN PLAN DIRECTLY AGAINST
FROM DROP DOWN MENU AND PLAN THE COST ELEMENTS
AGAINST THE COST ELEMENTS
--> SELECT FORM BASED RADIO BUTTON

-->SELECT OVERVIEW SCREEN BUTTON
--> FOR COST ELEMENT : 400100 PLAN FIXED COST 720000
--> SAVE
5. PLANNING ACTIVITY ( LABOUR ) HOURS ( OUTPUT PLANNING)
PATH : UPTO PLANNING THE PATH IS SAME
--> ACTIVITY OUTPUT / PRICES --> CHANGE [ KP26 ]
--> CO AREA :VIL ENTER
--> VERSION :0
--> FROM PERIOD : 9(DEC)
--> TO PERIOD : 9(DEC)
--> ACTIVITY TYPE : SELECT VIL1 i.e., LABOUR HOURS
--> SELECT FORM-BASED RADIO BUTTON
--> SELECT OVERVIEW SCREEN BUTTON
46
--> PLAN ACTIVITY : 72000
--> SAVE
6. PLAN ACTIVITY PRICE(LABOUR HOUR RATE )CALCULATION

PATH : UPTO PLANNING THE PATH IS SAME
--> ALLOCATIONS --> PRICE CALCULATION [ KSPI ]
--> COST CENTER GROUP :SELECT VILOGRP
--> SELECT SAVE BUTTON
2nd METHOD :- ACTIVITY DEPENDENT PLANNING
1. PLANNING COST CENTERWISE FOR JAN, 24
[KP06]
--> VERSION : 0
--> FROM :10(JAN)
--> TO : 10(JAN)
--> COST ELEMENT : 400000
--> TO : 499999
--> SELECT FORM BASED RADIO BUTTON
--> FOR COST ELEMENT 400100 PLAN FIXED COST 144000
--> PLAN VARIABLE COST 576000
--> SAVE
2. PLANNING ACTIVITY (LABOUR ) HOURS FOR DEC,23
[ KP26 ] (OUTPUT PLANNING)
--> VERSION : 0
--> FROM : 10(JAN)
--> TO : 10(JAN)
--> COST CENTER : SELECT DEPTO
--> ACTIVITY TYPE : SELECT VIL1 i.e., LABOUR HOURS
--> SAVE
3. PLAN ACTIVITY PRICE ( LABOUR HOUR RATE )CALCULATION FOR DEC,
23 [ KSPI ]
COST CENTER GROUP: SELECT VILOGRP
47
1ST 2ND METHOD
METHOD
ACTIVITY INDEPENDENT ACTIVITY
DEPENDENT
FIXED FIXED VARIABLE TOTAL
PLAN 720000 144000 576000 720000
COST
PLAN 72000 72000
HOURS
PLAN 720000/72000= 144000/72000= 576000/72 720000/72000=
PRICE 10 Rs 2 Rs 000= 10 Rs
8 Rs
EXAMPLE FOR FIXED AND VARIABLE COST:

PRODUCTION IN 1000 2000 3000
KGS
RENT-FIXED 2000 2000 2000
COST
POWER-UNITS 8000 16000 24000
REQUIRED PER 1
KG OF
PRODUCTION -
1 UNIT (UNIT
RATE-8 Rs. PER
UNIT)
TOTAL COST 10000 18000 26000
3RD METHOD:
ENTER ACTIVITY PRICE MANUALLY IN KP26
TO SEE ACTIVITY PRICE REPORT:
PATH : - ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING -->
INFORMATION SYSTEM --> REPORTS FOR COST CENTER ACCOUNTING -->
PRICES-->COST CENTERS: ACTIVITY PRICES [ KSBT ]
48
ACTUAL ACTIVITY PRICE CALCULATION
ACTUAL COST IN THE COST CENTER / ACTUAL ACTIVITY HOURS
3 METHODS AVAILABLE : -
1. AT THE TIME OF POSTING IN FI WE GIVE COST CENTER. ACTUAL COST WILL

BE UPDATED IN COST CENTER. WE GIVE ACTUAL HOURS IN CONFIRMATION OF
PRODUCTION ORDER (CO11N). WHEN WE EXECUTE ACTUAL ACTIVITY PRICE
CALCULATION [ KSII ] ACTUAL ACTIVITY PRICE WILL BE CALCULATED .
- THIS WILL BE COVERED IN PRODUCT COSTING .
2. ENTER ACTUAL ACTIVITY PRICE MANUALLY
3. IF WE DO NOT USE ABOVE 2 METHODS - IT TAKES PLAN ACTIVITY PRICE.
2ND METHOD: ENTER ACTUAL ACTIVITY PRICE MANUALLY
PATH : - ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING -->

ACTUAL POSTINGS --> ACTUAL PRICE --> ENTER [ KBK6 ]
--> PERIOD:9(DEC)
--> TO PERIOD: 9(DEC)
-->COST CENTER : DEPTO
--> ACTIVITY TYPE : VIL1 i.e., LABOUR HOURS
--> SELECT FORM- BASED RADIO BUTTON
--> FIXED ACTIVITY PRICE AREA CURRENCY : 10 Rs.
--> SAVE
ACTIVITY ALLOCATION
WE CAN ALLOCATE COST FROM ONE COST CENTER TO OTHER COST CENTERS
BASED ON ACTIVITIES.
1. DIRECT ACTIVITY ALLOCATION
2. INDIRECT ACTIVITY ALLOCATION
COST CENTER DEPTO ( SERVICE DEPT - LABOUR COST CENTER )

WAGES 400000
OVERTIME WAGES 200000
BONUS 70000
WORKERS WELFARE 50000
TOTAL 720000
WORKERS - 100 WORKERS PER SHIFT - WORKING FOR 3 SHIFTS. EACH SHIFT 8
HOURS
NO. OF DAYS WORKED IN MONTH: 30 DAYS
49
LABOUR HOURS (ACTIVITY TYPE ) AVAILABLE FOR THE MONTH =100
WORKERS *3*8HRS *30 DAYS = 72000 HRS
LABOUR HOUR RATE 720000 /72000 = 10
LABOUR HOURS SUPPLIED TO PRODUCTION DEPARTMENTS BY DEPTO:

DEPTM DEPTN
LABOUR HOURS USED 50000 HRS 22000 HRS
LABOUR HOUR RATE 10 10
COST ALLOCATION 500000 220000

FROM DEPTO

COST CENTER DEPTP
(SERVICE COST CENTER - QUALITY INSPECTION DEPT )
SALARIES 100000
POWER 200000
RENT 45600
TOTAL 345600
DEPT P CHECKS QUALITY NORMS OF PRODUCTION RECEIVED FROM
DIFFERENT PRODUCTION DEPARTMENTS.
WORKERS - 20 PER SHIFT - WORKING FOR 3 SHIFTS i.e.,: - 24 HRS
NO.OF DAYS WORKED 30 DAYS
QUALITY INSPECTION HOURS AVAILABLE =
20 WORKERS*3*8 HRS*30 DAYS = 20* 24 * 30 = 14400 HRS
QUALITY INSPECTION HOUR RATE 345600/14400 = 24 PER HOUR
ISSUE :-
WE KNOW HOW MANY QUALITY INSPECTION HOURS SPENT FOR QUALITY
CHECK. WE DO NOT KNOW HOW MANY QUALITY INSPECTION HOURS SPENT
FOR EACH DEPARTMENT PRODUCTION.
PRODUCTION COST DEPTM DEPTN
CENTERS
PRODUCTION 30000 KGS 20000KGS
ALLOCATION BASED ON 14400 * 30000/50000= 14400*20000/50000=

PRODUCTION
8640 5760
QUALITY INSPECTION 24 24
HOUR RATE
ALLOCATION OF COST 207360 138240
50
FROM DEPT P
CONCLUSION :-
1. IF WE KNOW HOW MANY HOURS ARE SUPPLIED BY SENDER COST CENTER

TO EACH RECEIVER COST CENTER - USE DIRECT ACTIVITY ALLOCATION.
2.IF WE DO NOT KNOW HOW MANY HOURS ARE SUPPLIED BY SENDER COST
CENTER TO EACH RECEIVER COST CENTER-ALLOCATE THE TOTAL HOURS OF
SENDER COST CENTER BASED ON PRODUCTION OF RECEIVER COST CENTERS-
USE INDIRECT ACTIVITY ALLOCATION
I . DEFINE CO NO. RANGE INTERVAL FOR THE BUSINESS TRANSACTION RKL

i.e., -ACTUAL ACTIVITY ALLOCATION [ KANK ]

--> KEEP THE CURSOR ON RKL
--> ENTER
--> SAVE
II . POSTING OF SALARIES FOR THE MONTH OF DEC 23 [ FB01L OR FB50L ]

--> DOCUMENT DATE AND POSTING DATE : 31.12.2023
--> TYPE : SA
--> ACCOUNT NO. : 400100 SALARIES A/C
--> ENTER
--> AMOUNT : 720000
-->POSTING KEY : 50
--> ACCOUNT NO : 200100 CASH ACCOUNT
--> ENTER
--> AMOUNT : *
--> TEXT : +
--> FROM THE MENU BAR SELECT DOCUMENT-->SIMULATE AND SAVE
III.ENTER ACTUAL ACTIVITY PRICE FOR DEC,23 [ KBK6 ]

IF WE DO NOT ENTER ACTUAL ACTIVITY PRICE IT TAKES PLAN ACTIVITY
PRICE

--> FROM PERIOD :9 (DEC)
--> TO PERIOD : 9 (DEC)
51
--> ACTIVITY TYPE :VIL1 i.e., LABOUR HOURS
--> FIXED ACTIVITY PRICE AREA CURRENCY : 10
--> SAVE
IV . ENTER ACTIVITY ALLOCATION FOR DEC,23
PATH :- ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING -->
ACTUAL POSTINGS --> ACTIVITY ALLOCATION --> ENTER [ KB21N ]
--> DOCUMENT DATE AND POSTING DATE :31.12.2023
SENDER COST SENDER ACTIVITY RECEIVER COST TOTAL

CENTER TYPE CENTER QUANTITY
DEPTO VIL1 DEPTM 50000
DEPTO VIL1 DEPTN 22000
--> SAVE
V . TO VIEW COST CENTER REPORT FOR DEC,23 [ KSB1 ]

--> POSTING DATE : 01.12.2023 TO 31.12.2023
--> SELCET EXECUTE BUTTON
-->FROM COLUMN SET ACTIVATE PARTNER COST CENTER
--> ENTER
I . CREATION OF ACTIVITY TYPE i.e.,: - QUALITY INSPECTION HOURS[KL01]

--> ACTIVITY TYPE:VIL2
--> VALID FROM : 01.04.2023
--> COPY FROM ACTIVITY TYPE:VIL1
--> ENTER
-->CHANGE THE NAME :QUALITY INSPECTION HOURS
--> DESCRIPTION : QUALITY INSPECTION HOURS
--> ACTIVITY TYPE CATEGORY :3 MANUAL ENTRY -INDIRECT ALLOCATION
--> SAVE
II . CREATION OF COST CENTER DEPTP [ KS01 ]

--> COST CENTER : DEPTP
--> VALID FROM : 01.04.2023
--> REFERENCE COST CENTER : DEPTO
--> CO AREA :VIL
--> ENTER
52
--> CHANGE THE NAME TO DEPARTMENT P
--> DESCRIPTION : COST CENTER DEPARTMENT P
--> SAVE
III . CREATION OF COST CENTER GROUP [ KSH1 ]
--> COST CENTER GROUP:VILPGRP
--> ENTER
--> DESCRIPTION : COST CENTER GROUP VILP GROUP
-->SELECT INSERT COST CENTER BUTTON
--> SELECT THE COST CENTER : DEPTP
--> SAVE
IV . PLANNING COST CENTERWISE [ KP06 ]

--> VERSION 0
-->FROM PERIOD: 9 (DEC)
--> FISCAL YEAR: 2023
--> COST ELEMENT : 400100 SALARIES
--> PLAN FIXED COST :408000
--> SAVE
V . PLANNING QUALITY INSPECTION HOURS [ KP26 ]

--> VERSION : 0
-->FROM PERIOD: 9 (DEC)
--> SAVE
VI . PLAN ACTIVITY PRICE ( QUALITY INSPECTION HOUR RATE )

CALCULATION [ KSPI ]
= 408000 /17000= 24
--> COST CENTER GROUP :VILPGRP

--> SAVE
-->IGNORE THE MESSAGE AND ENTER
IF WE DONOT ENTER ACTUAL ACTIVITY PRICE , THIS PRICE WILL BE TAKEN

AT THE TIME OF ACTUAL ACTIVITY PRICE ALLOCATION.
VII . DEFINE CO NUMBER RANGE INTERVAL FOR BUSINESS TRANSACTIONS

[KANK]
53
RKN - ACTUAL NON - ALLOCATION ACTIVITIES
RKIL - ACTUAL INVERSE ACTIVITY ALLOCATION
--> CO AREA :VIL
--> KEEP THE CURSOR ON RKN
--> ENTER
--> KEEP THE CURSOR ON RKIL
--> ENTER
--> SAVE
VIII . POSTING OF TRANSACTION IN DEPTP [ FB01L ]

-->DOCUMENT DATE AND POSTING DATE: 31.12.2023
--> TYPE : SA
--> ENTER
--> AMOUNT : 345600
--> ENTER
--> AMOUNT : *
--> TEXT : +
--> FROM THE MENU SELECT DOCUMENT -->SIMULATE AND SAVE
IX . ENTER SENDER ACTIVITIES

ACTUAL POSTINGS --> SENDER ACTIVITIES --> ENTER
[ KB51N ]
--> SENDER COST CENTER :DEPTP
--> SENDER ACTIVITY TYPE :VIL2 QUALITY INSPECTION HOURS
--> TOTAL QUANTITY : 14400
--> SAVE
IF GENERATES A CO DOCUMENT BECAUSE OF ASSIGNMENT OF CO NO. RANGE

INTERVAL FOR RKN
X. CREATION OF STATISTICAL KEY FIGURE - PRODUCTION [ KK01 ]

--> CO AREA :VIL
--> ENTER
--> STATISTICAL KEY FIGURE : PROD
54
--> ENTER
--> NAME : PRODUCTION
--> STATISTICAL KEY FIGURE UNM- SELECT KG
--> KEY FIGIURE CATAGORY:SELECT TOTAL VALUES RADIO BUTTON
--> SAVE
XI . ENTER STATISTICAL KEY FIGURES [ KB31N ]

DOCUMENT DATE AND POSTING DATE :31.12.2023
RECEIVER COST CENTER STATISTICAL KEY TOTAL QTY
FIGURE
DEPTM PROD 30000
DEPTN PROD 20000
--> SAVE
XII . CREATION OF INDIRECT ACTIVITY ALLOCATION CYCLE
PERIOD END CLOSING --> CURRENT SETTINGS --> DEFINE INDIRECT ACTIVITY
ALLOCATION
--> CYCLE :VIL1
--> START DATE: 01.04.2023
--> ENTER
--> TEXT :VIL INDIRECT ACTIVITY ALLOCATION CYCLE
--> SAVE
--> SELECT ATTACH SEGMENT BUTTON
--> SEGMENT NAME : SEGMENT1-DESCRIPTION: SEGMENT1
--> SENDER VALUES RULE : POSTED QUANTITIES
--> SHARE IN % : 100
--> SELECT ACTUAL VALUES RADIO BUTTON
--> RECEIVER TRACING FACTOR RULE : VARIABLE PORTIONS
--> VARIABLE PORTION TYPE : ACTUAL STATISTICAL KEY FIGURES
--> SCALE NEG. TRACING FACTORS: NO SCALING
--> SELECT SENDERS / RECEIVERS TAB
--> SENDER COST CENTER : DEPTP
--> RECEIVER COST CENTER : DEPTM TO DEPTN
-->SELECT RECEIVER TRACING FACTOR TAB
--> STAT KEY FIGURE : PROD
-->SELCECT RECEIVER WEIGHTING FACTORS TAB
--> SAVE
XIII . INDIRECT ACTIVITY ALLOCATION RUN [T/C KSC5]
--> UPTO PERIOD - END CLOSING THE PATH IS SAME
--> SINGLE FUNCTIONS --> ALLOCATIONS --> INDIRECT ACTIVITY
ALLOCATION
--> PERIOD :9 TO 9
--> DESELECT TEST RUN CHECK BOX
--> SELECT DETAIL LISTS CHECK BOX
--> CYCLE :VIL1
55
--> SELECT RECEIVER BUTTON
CREATED CO DOCUMENT BECAUSE OF ASSIGNMENT OF NUMBER RANGE

INTERVAL FOR BUSINESS TRANSACTION RKIL i.e., ACTUAL /INVERSE
ACTIVITY ALLOCATION
XIV . TO VIEW COST CENTER REPORT [T/C KSB1 ]

--> COST CENTER :DEPTP
--> POSTING DATE 01.12.2023 TO 31.12.2023
PERIOD END CLOSING
IN THE MONTH END WE ALLOCATE COST FROM ONE COST CENTER TO OTHER
COST CENTERS.
COST CENTER DEPTO DEPTM DEPTN
( SERVICE DEPT ) ( PRODUCTION DEPARTMENTS )
SALARIES 100000}
WAGES 500000 } BASED ON STATISTICAL KEY FIGURES
RENT 50000 BASED ON PERCENTAGE

TOTAL 650000
THE BASIS OF ALLOCATION MAY BE PERCENTAGE BASIS / ACTUAL AMOUNT
BASIS / STATISTICAL KEY FIGURES BASIS / ACTIVITY TYPE BASIS.
SAP HAS GIVEN 4 ALLOCATION METHODS
1. ASSESSMENT
2. DISTRIBUTION
3. PERIODIC REPOSTING
1. ASSESSEMENT : -
A .WE CAN ALLOCATE PRIMARY COST POSTINGS AND SECONDARY COST

ALLOCATIONS
DEPTX DEPTO DEPTM DEPTN
WAGES : 200000 SALARIES 100000 WAGES : 300000 WAGES : 400000

WAGES : 500000
LESS : - ADD : - ADD :-
RENT : 50000
ALLCN O 200000
ALLCN O 680000 ALLCN O 170000
ADD :-
ALLCN X 200000
LESS : -
ALLCN M
56
80 % -680000
ALLCN N
20 % - 170000
0 0 980000 570000
FROM DEPTO TO DEPTM AND DEPTN:
PRIMARY COST POSTINGS: DIRECT POSTINGS - SALARIES / WAGES / RENT
SECONDARY COST ALLOCATION - ALLOCATION FROM X
B.RECEIVER COST CENTER CAN NOT TRACK THE ORIGINAL COST ELEMENTS -
DEPTM RECEIVED FROM DEPTO RS 680000
IT WILL NOT SHOW WHAT IS SALARIES PORTION /WAGES PORTION / RENT
PORTION OF O
C. SENDER SHOULD BE A COST CENTER
D .DEFINE CO NUMBER RANGE INTERVAL FOR BUSINESS TRANSACTION- RKIU

i.e., ACTUAL OVERHEAD ASSESSMENT
2. DISTRIBUTION :-
A. WE CAN ALLOCATE ONLY PRIMARY COST POSTINGS

B. RECEIVER COST CENTER CAN TRACK ORIGINAL COST ELEMENTS
C . SENDER SHOULD BE A COST CENTER
D .DEFINE CO NUMBER RANGE INTERVAL FOR BUSINESS TRANSACTION RKIV
i.e., ACTUAL OVERHEAD DISTRIBUTION
3. PERIODIC REPOSTING :-
A . WE CAN ALLOCATE ONLY PRIMARY COST POSTINGS
C. SENDER CAN BE A COST CENTER OR ORDER
D. DEFINE CO NUMBER RANGE INTERVAL FOR BUSINESS TRANSACTION RKIB
i.e., PERIODIC REPOSTING

A .WE CAN ALLOCATE ONLY PRIMARY COST POSTINGS
C. SENDER SHOULD BE A COST CENTER
D .DEFINE CO NUMBER RANGE INTERVAL FOR BUSINES TRANSACTION RKIL
i.e., ACTUAL INVERSE ACTIVITY ALLOCATION
E . WE CAN TRANSFER QUANTITIES AS WELL AS VALUES.
WHICHEVER METHOD WE FOLLOW WE HAVE TO CREATE CYCLES .WHERE

COST ELEMENTS ALLOCATION IN A COST CENTER IS DIFFERENT WE HAVE TO
57
CREATE NUMBER OF CYCLES OR CREATE NUMBER OF SEGMENTS UNDER A
CYCLE
COST CENTER DEPT O DEPT M DEPT N

(SERVICE DEPT ) ( PRODUCTION DEPARTMENTS )
SALARIES 100000 }
WAGES 500000 } BASED ON STATISTICAL KEY FIGURES
RENT 50000 BASED ON PERCENTAGE
TOTAL 650000
OPTION 1 : - CREATE NUMBER OF CYCLES
CYCLE 1
|
SEGMENT 1
(SALARIES AND WAGES ALLOCATION )
400100 SALARIES ACCOUNT
CYCLE 2
|
SEGMENT1
( RENT ALLOCATION )
400300 RENT ACCOUNT
OPTION : 2 CREATE NUMBER OF SEGMENTS UNDER A CYCLE
CYCLE 1
|
SEGMENT 1 SEGMENT 2
( SALARIES AND WAGES ALLOCATION ) ( RENT ALLOCATION )
400100 SALARIES ACCOUNT 400300 RENT ACCOUNT
GENERALLY COMPANIES FOLLOW OPTION 2
1st METHOD : ASSESSMENT :-
I . DEFINE SECONDARY COST ELEMENT i.e.,: ASSESSEMENT COST ELEMENT

[T/C KA06 ]
--> ENTER
--> COST ELEMENT : 900001
--> VALID FROM : 01.04.2023
--> ENTER
--> NAME AND DESCRIPTION : ASSESSMENT COST ELEMENT
--> COST ELEMENT CATEGORY : SELECT 42 (ASSESSMENT)
--> SAVE
58
II . DEFINE CO NO. RANGE INTERVAL FOR THE BUSINESS TRANSACTION-
RKIU-i.e., : ACTUAL OVERHEAD ASSESSMENT [ KANK ]

--> KEEP THE CURSOR ON RKIU
--> ENTER
--> SAVE
III . POSTING OF TRANSACTION FOR DEC 23 [ FB01L ] OR [ FB50L ]

--> DOCUMENT AND POSTING DATE :31.12.2023
--> TYPE : SA
-->G/L ACCOUNT: 400100 SALARIES A/C
--> ENTER
--> IGNORE THE MESSAGE
--> ENTER
--> AMOUNT : 600000
--> POSTING KEY :40
-->G/L ACCOUNT: 400300 RENT A/C
--> ENTER
--> AMOUNT : 50000
--> COST CENTER : DEPT O
-->G/L A/C: 200100 CASH A/C
--> ENTER
--> AMOUNT : *
--> TEXT : EXPENDITURE POSTING
--> FROM THE MENU BAR DOCUMENT -->SIMULATE AND SAVE
IV . CREATION OF ASSESSMENT CYCLE

PERIOD END CLOSING --> CURRENT SETTINGS --> DEFINE ASSESSMENT
(TR.CODE S_ALR_87005742)
--> CYCLE :VIL2
--> START DATE : 01.04.2023
--> ENTER
--> TEXT : VIL ASSESSMENT CYCLE
--> SELECT ITERATIVE CHECK BOX.
59
SELECT ITERATIVE CHECK BOX : -
COST CENTER DEPTO
( SERVICE DEPT ) 1ST RUN 2ND RUN
SALARIES 1,00,000 DEPT M 50% 3,25,000 16,500
WAGES 5,00,000 DEPT N 30 % 1,95,000 9900
RENT 50,000 DEPT X 20 % 1,30,000 6600
TOTAL 6,50,000
( - ) LESS :- ALLCN - 6,50,000
0
ADD: -ALLCN FROM X 33,000
33,000
LESS : - ALLCN - 33,000
0
COST CENTER DEPT X

WAGES 2,00,000 DEPT Y 40 % 1,32,000
ADD:ALLNFROM O 1,30,000 DEPT Z 50 % 1,65,000
----------------- DEPT O 10 % 33,000
3,30,000
LESS : ALLCN - 3,30,000
---------------
0
ADD : ALLCN O 6,600
-------------
6,600
WE HAVE TO RUN NUMBER OF TIMES TILL BOTH COST CENTER VALUES
BECOME ZERO. IF WE SELECT ITERACTIVE CHECK BOX, SYSTEM RUNS
AUTOMATICALLY NUMBER OF TIMES TILL THEY BECOME ZERO .

--> SEGMENT NAME : SEGMENT 1
--> TEXT : SALARIES ALLOCATION
--> ASSESSMENT COST ELEMENT :SELECT 900001
--> SENDER RULE :SELECT POSTED AMOUNTS
--> SHARE IN % : 100
--> SELECT ACTUAL VALUE ORIGIN RADIO BUTTON
--> RECEIVER RULE :SELECT VARIABLE PORTIONS
--> VARIABLE PORTION TYPE :SELECT ACTUAL STATISTICAL KEY FIGURES
--> SCALE NEG . TRACING FACTORS : NO. SCALING
--> SENDER COST CENTER : DEPTO
--> SENDER COST ELEMENT : 400100 (SALARIES A/C)
--> SELECT RECEIVER TRACING FACTOR TAB
--> STATISTICAL KEY FIGURE : EMP
--> SELECT RECEIVER WEIGHTING FACTORS TAB
--> SELECT SAVE BUTTON OR CRL+S
60
--> SEGMENT NAME : SEGMENT2 [ RENT ALLOCATION ]
--> ASSESSMENT COST ELEMENT : 900001
--> SENDER RULE : POSTED AMOUNTS
--> SHARE IN % : 100 %
--> RECEIVER RULE : SELECT FIXED PERCENTAGES
--> SELECT SENDERS/ RECEIVERS TAB
--> COST ELEMENT : 400300 (RENT )
-->RECEIVER COST CENTER : DEPTM TO DEPT N
--> DEPTM:PORTION/PERCENT 80
--> DEPTN :PORTION/PERCENT 20
--> SAVE
V. COST CENTER REPORT [ KSB1 ]

--> POSTING DATE : 01.12.2023 TO 31.12.2023
Eg : - DEPT O DEPT M DEPT N
400100 SALARIES 600000 STATISTICAL KEY FIGURES BASIS
100 EMP 25 EMP
480000 120000
400300 RENT 50000 PERCENTAGE BASIS
80% 20%
40000 10000
VI . ACTUAL ASSESSMENT RUN

PATH :ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING -->
PERIOD END CLOSING --> SINGLE FUNCTIONS --> ALLOCATIONS -->
ASSESSMENT (KSU5)
--> PERIOD : 9(DEC) TO 9(DEC)
--> CYCLE SELECT : VIL2
2ND METHOD - DISTRIBUTION :-

1. DEFINE CO NUMBER RANGE INTERVAL FOR BUSINESS TRANSACTION RKIV -
ACTUAL OVERHEAD DISTRIBUTION [ KANK ]
2. CREATION OF DISTRIBUTION CYCLE [ S _ ALR _ 87005757 ]
3. POSTING OF TRANSACTION FOR JAN, 24 [ FB01L ]
4. DISTRIBUTION RUN FOR JAN, 24 [ KSV5]
61
3RD METHOD - PERIODIC REPOSTING
1. DEFINE CO NUMBER RANGE INTERVAL FOR BUSINESS TRANSACTION RKIB -
ACTUAL OVERHEAD PERIODIC [ KANK ]
2. CREATION OF PERIODIC REPOSTING CYCLE [ S _ ALR _ 87005395 ]
3. POSTING OF TRANSACTION FOR FEB, 24 [ FB01L ]
4. PERIODIC REPOSTING RUN FOR FEB, 24 [ KSV5]
SCALE NEGATIVE TRACING FACTORS

 NEGATIVE TRACING FACTORS CAN APPEAR WHEN THE TRACING
FACTORS ARE NOT ENTERED AS FIXED SIZES OR PERCENTAGES BUT
ARE TAKEN FROM DATABASE. THIS CAN OCCUR FOR EXAMPLE- DURING
DISTRIBUTION BY ACTIVITY TYPE OR STATISTICAL KEY FIGURES
COST CENTER : DEPTM
NOV 23 DEC 23 TOTAL
PRODUCTION IN 4000 2000 6000

KGS
NOV 23 -3000 -3000

PRODUCTION
ISSUE FOR
REPROCESSING TO
SHOP FLOOR IN
DEC 23 DUE TO
QUALITY
PROBLEMS
NET PRODUCTION 4000 -1000 3000

FOR THE MONTH
Eg : -
DEPTM DEPTN
PRODUCTION DEPTS
PRODUCTION IN DEC 23 1000- KGS 5000 KGS
SERVICE DEPT DEPTO
SALARIES 100000
TO ALLOCATE DEPTO COST ON STATISTICAL KEY FIGURES BASIS TO
PRODUCTION DEPARTMENT M AND DEPARTMENT N
OPTION 1 : NO SCALING
DEPTO DEPTM DEPTN TOTAL

COST 100000
62
SKF i.e., : PRODUCTION IN DEC 1000 - 5000 4000
ALLOCATION 100000 * 1000-/4000 100000 * 5000 / 4000
= - 25000 = 125000 100000
OPTION 2 : STANDARD SCALING

MAKING NEGATIVE TRACING FACTOR TO POSITIVE WHEN WE RUN
COST 100000
SKF i.e., : PRODUCTION1000 - 5000 4000

TO MAKE IT POSITIVE 1000 1000 2000
0 6000 6000
ALLOCATION 100000* 0/6000 100000 * 6000 / 6000
=0 = 100000 = 100000
OPTION 3 :- NEGATIVE TO POSITIVE
SYSTEM TAKES NEGATIVE FIGURE AS POSITIVE FIGURE
COST 100000
SKF i.e.,: PRODUCTION 1000 - 5000 4000
TAKES AS POSITIVE FIGURE 1000 5000 6000
ALLOCATION 100000 * 1000 / 6000 100000 * 5000/6000
=16666.67 = 83333.33 = 100000
OPTION 4 :- NEGATIVE TRACING FACTORS TO ZERO
STSTEM WILL CONSIDER NEGATIVE TRACING FACTOR ZERO
DEPTO DEPT M DEPTN TOTAL
COST 100000
SKF i.e., : PRODUCTION 1000- 5000 4000
0 5000 5000
ALLOCATION 100000 * 0 /5000 100000 * 5000 / 5000
=0 = 100000 = 100000
63
1. POSTING OF EXPENDITURE FOR THE MONTH OF DEC, 23 [ FB01L ]
-->DOCUMENT DATE AND POSTING DATE:31.12.2023

--> TYPE : SA
--> ENTER
--> AMOUNT : 100000
--> ACCOUNT : 200105 SBI CURRENT ACCOUNT
--> ENTER
--> AMOUNT : *
--> TEXT : +
2. ENTER STATISTICAL KEY FIGURES FOR DEC , 23 [KB31N]

-->DOCUMENT DATE AND POSTING DATE : 31.12.2023
RECEIVER COST CENTER STATISTICAL KEY FIGURE TOTAL QUANITY
DEPTM PROD 1000 -
DEPTN PROD 5000
--> SAVE
3. CREATION OF ASSESSMENT CYCLE [ S_ALR_87005742 ]
PERIOD END CLOSING --> CURRENT SETTINGS --> DEFINE ASSESSMENT
--> CYCLE :VIL3
--> START DATE : 01.04.2023
--> ENTER
--> TEXT : VIL3 ASSESSMENT CYCLE
--> SELECT ITERATIVE CHECK BOX.
--> SELECT ATTACH SEGMENT BUTTON.
--> SEGMENT NAME : SEGMENT1 [ SALARIES ALLOCATION ]
--> ASSESSMENT COST ELEMENT :SELECT 900001
--> SENDER RULE :SELECT POSTED AMOUNTS
--> SHARE IN % : 100
--> RECEIVER RULE :SELECT VARIABLE PORTIONS
--> VARIABLE PORTION TYPE :SELECT ACTUAL STATISTICAL KEY FIGURES
--> SCALE NEG . TRACING FACTORS- NO SCALING
64
--> SENDER COST ELEMENT : 400100 (SALARIES A/C)
--> STATISTICAL KEY FIGURE : PROD
--> SAVE
4 . ASSESSMENT RUN FOR DEC 23 [ KSU5 ]

--> PERIOD :9 TO 9 (DEC)
--> SELECT TEST RUN CHECK BOX
-->CYCLE :VIL3
OPTION 2:STANDARD SCALING

1. CHANGE ASSESSMENT CYCLE : KSU2
--> CYCLE :VIL3
--> ENTER
--> SELECT FIRST SEGMENT BUTTON
--> SCALE NEG TRACING FACTORS: SELECT STANDARD SCALING
--> SAVE
2. ASSESSMENT RUN (KSU5)
--> PERIOD:9 TO 9 (DEC)
--> CYCLE :VIL3
OPTION 3: NEGATIVE TO POSITIVE
1. CHANGE ASSESSMENT CYCLE : KSU2
--> CYCLE :VIL3
--> ENTER
65
--> SCALE NEG TRACING FACTORS: SELECT ABSOLUTE VALUE (NEGATIVE TO
POSITIVE) ]
--> SAVE

--> PERIOD 9 TO 9 (DEC)
--> CYCLE :VIL3
OPTION 4: NEGATIVE TRACING FACTORS TO ZERO

1. CHANGE ASSESSMENT CYCLE [ KSU2 ]
--> CYCLE :VIL3
--> ENTER
--> SCALE NEG. TRACING FACTORS :SELECT NEGATIVE TRACING FACTORS TO
ZERO
--> SAVE

--> PERIOD 9 TO 9(DEC)
--> CYCLE :VIL3
COST CENTERWISE PLANNING, ACTUALS POSTINGS AND TO VIEW

VARIANCE REPORT
1. PLANNING COST CENTERWISE [ KP06]

--> VERSION: 0
66
--> FROM PERIOD 1 TO PERIOD 12
--> FISCAL YEAR 2023
--> COST ELEMENT 400000 TO 499999
--> COST ELEMENT 400100
--> PLAN FIXED COST 3600000
--> DISTRIBUTION KEY : 1 [EQUAL DISTRIBUTION]
--> SELECT COST ELEMENT 400100
--> SELECT PERIOD SCREEN BUTTON
--> SELECT BACK ARROW BUTTON
--> FOR COST ELEMENT 400300
--> DISTRIBUTION KEY 1 [EQUAL DISTRIBUTION]
--> SAVE
2 . POSTING OF EXPENDITURE FOR THE MONTH OF DEC , 23 [ FB01L ]
1ST ENTRY:
--> TYPE : SA
--> ENTER
--> AMOUNT : 280000
--> ENTER
--> AMOUNT : *
-->PROFIT CENTER : STEEL
--> TEXT : +
2ND ENTRY:
--> TYPE : SA
--> ACCOUNT : 400300 RENT ACCOUNT
--> ENTER
--> AMOUNT : 125000
67
--> ENTER
--> AMOUNT : *
-->PROFIT CENTER : STEEL
--> TEXT : +
3. TO VIEW VARIANCE REPORT

PATH :- ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING -->
INFORMATION SYSTEM--> REPORTS FOR COST CENTER ACCOUNTING -->
PLAN / ACTUAL COMPARISONS --> COST CENTERS : ACTUAL / PLAN /
VARIANCE
-->FISCAL YEAR : 2023
--> FROM PERIOD 9 TO PERIOD 9 (DEC)
--> PLAN VERSION : 0
--> COST CENTER VALUES: DEPTM
--> KEEP THE CURSOR ON ACTUAL COST RENT A/C 125000 --> SELECT CALL
UP REPORT BUTTON
--> DOUBLE CLICK ON COST CENTERS : ACTUAL LINE ITEMS
--> KEEP THE CURSOR ON RENT ACCOUNT LINE ITEM
--> SELECT DOCUMENT BUTTON
DISTRIBUTION KEYS
WHEN WE PLAN FOR MORE THAN ONE MONTH WE CAN SPECIFY HOW TO
ALLOCATE FOR EACH MONTH BY USING DISTRIBUTION KEYS .
SAP HAS GIVEN FOLLOWING DISTRIBUTION KEYS:
DISTRIBUTION KEY :-
0 MANUAL DISTRIBUTION - ALLOCATE MANUALLY EACH MONTH
1 EQUAL DISTRIBUTION - ALLOCATE EQUALLY FOR EACH MONTH
2 AS BEFORE - ALLOCATE AS PER EARLIER BASIS FOR EACH MONTH
3 BY PERCENTAGE - ALLOCATE PERCENTAGE BASIS FOR EACH MONTH
1. PLANNING COST CENTERWISE [ KP06 ]

--> VERSION : 0
--> FISCAL YEAR 2023
--> COST ELEMENT : 400100 SALARIES A/C
68
--> COST ELEMENT 400100
--> PLAN FIXED COSTS : 2400000
--> DISTRIBUTION KEY :SELECT 1[ EQUAL ]
-->SELECT BACK ARROW
--> SAVE
--> DISTRIBUTION KEY: SELECT 0 (MANUAL DISTRIBUTION)
--> APRIL PLAN FIXED COST CHANGE TO 100000
--> MARCH PLAN FIXED COST CHANGE TO 300000
--> SAVE
--> DISTRIBUTION KEY :SELECT 2 (DISTRIBUTION AS BEFORE)
--> ENTER
--> APRIL 200000
--> MARCH 600000
--> SAVE
DISTRIBUTION BY PERCENTAGE : -
--> PLAN FIXED COST : 5
--> DISTRUBUTION KEY : 3 DISTUBUTION BY PERCENTAGE
--> SAVE
-->SELECT COST ELEMENT 400100
--> SAVE
SUMMARY : -
DISTRIBUTION TOTAL PLAN OTHER APR MARCH
KEYS AMOUNT MONTHS
EACH MONTH
1 EQUAL 2400000 200000 200000 200000
DISTRIBUTION
0 MANUAL 2400000 200000 100000 300000
DISTRIBUTION
69
2 AS BEFORE 4800000 400000 200000 600000
3 BY 5
PERCENTAGE 240000 20000 10000 30000
COST CENTER PLANNING WITH REVALUATION

COST CENTER DEPTM - PLANNING FOR NEXT YEAR APR 2024 BASED ON
ACTUALS OF DEC 2023 - WITH REVALUATION 10 % INCREASE
OR
WE HAVE PLANNED COST FOR COST CENTER DEPTM i.e., VERSION 0.

ACTUALS ARE COMING IN DIFFERENT WAY. TO CHANGE PLANNED FIGURES.
COPY COST CENTER DEPTM PLANNING VERSION 0 TO VERSION 1 WITH

REVALUATION 10% INCREASE.
1. TO SELECT COPYING ALLOWED CHECK BOX FOR THE YEAR 2023 [T/C
OKEQ ]
--> SELECT VERSION 0

--> DOUBLE CLICK ON SETTINGS FOR EACH FISCAL YEAR FOLDER
--> CO AREA :VIL ENTER
--> SELECT COPYING ALLOWED CHECK BOX
--> SAVE
2. COPY ACTUAL TO PLAN

PLANNING -->PLANNING AIDS --> COPY --> COPY ACTUAL TO PLAN [ KP98 ]

--> TEMPLATE (ACTUAL ) PERIOD 9 TO 9 (DEC)
--> TARGET (PLAN ) VERSION : 0
--> PERIOD: [ 1 ] TO [ 1 ] (APRIL)
--> FISCAL YEAR [ 2024 ]
--> SELECT SELECT ACTUAL DATA RADIO BUTTON
--> PRESS SELECTION BUTTON
--> SELECT PRIMARY COSTS CHECK BOX
--> ENTER
3. CREATE REVALUATION
70
PATH : SPRO --> CONTROLLING --> COST CENTER ACCOUNTING --> PLANNING
--> PLANNING AIDS -->DEFINE REVALUATION
--> DOUBLE CLICK ON CREATE PLAN REVALUATION
--> CONTROLLING AREA :VIL ENTER

--> REVALUATION :VIL
--> VERSION : 0
--> ENTER
--> TEXT :VIL PLAN REVALUATION
--> COST ELEMENT : 400100 TO 400300
--> KEEP THE CURSOR ON COST ELEMENT 400100
--> SELECT DEFINITION BUTTON
--> FROM : 1 (APRIL)
--> TO: 1 (APRIL)
--> COSTS : 10
--> SAVE AND SAVE IN YOUR REQUEST
4. REVALUATE COSTS [T/C KSPU ]

PLANNING --> PLANNING AIDS --> REVALUATE --> COSTS
--> VERSION : 0
--> FROM PERIOD [ 1 ] TO PERIOD [ 1 ] APRIL
--> REVALUATION :VIL
--> ENTER
5.TO VIEW COST CENTER REPORT [T/C KSB1 ]

--> COST CENTER :DEPTM
--> POSTING DATE : 01.12.2023 TO 31.12.2023
--> SELECT COST ELEMENT COLUMN
--> SELECT SUBTOTALS BUTTON
400100-SALARIES 425000
400300-RENT 60000
6.PLANNING COST CENTERWISE [T/C KP06 ]
--> VERSION :0
71
--> FROM PERIOD : 1
--> TO PERIOD : 1
--> COST ELEMENT : 400100 TO 400300
--> ENTER
--> SELECT FORM - BASED RADIO BUTTON
DEC, 23 INCREASE APRIL,24 PLAN
ACTUALS IN 10% AMOUNT
400100-SALARIES 425000 110% 467500
400300-RENT 60000 110% 66000
ACCRUAL ORDERS (IMPUTED COST CALCULATION)
THIS IS USED FOR MAKING MONTH END PROVISIONS ONLY IN CO.

THIS IS USED FOR IRREGULAR EXPENSES LIKE BONUS/LTA(LEAVE TRAVEL
ALLOWANCE )/GRATUITY/SUPER ANNUATION etc .,
DUE TO ACCRUAL ORDERS RUN A DOCUMENT WILL BE GENERATED ONLY IN

CO.
DEFINE CO NO. RANGE INTERVAL FOR BUSINESS TRANSACTION-KAZI i.e.,

ACTUAL COST CENTER ACCRUAL.
COST ELEMENT CATEGORY SHOULD BE 3-ACCRUAL/DEFERRAL PER

SURCHARGE.
EARLIER WE HAVE DISCUSSED MONTH END PROVISIONS IN FI
1st METHOD-ACCRUAL/DEFERRAL DOCUMENT
i) BONUS PROVISION ON 30.04.2023

BONUS A/C DR 100000 COST CENTER:DEPTM
TO OUTSTANDING EXP 100000
ii)IN THE MONTH END ALLOCATE TO PRODUCTION ORDERS

COST CENTER DEPTM
30.4.23 BONUS 100000DR
30.4.23
ALLOCATION 100000CR
TO PRODUCTION
ORDERS
COST CENTER DEPTM VALUE WILL BE ZERO

PRODUCTION VALUATION IS CORRECT
iii)REVERSAL OF PROVISION NEXT MONTH 1st i.e., : 1.5.2023
72
OUTSTANDING EXP DR 100000
TO BONUS 100000 COST CENTER:DEPTM
iv) TO MAKE BONUS PROVISION ON 31.5.23

v)COST CENTER REPORT
- IN THE MONTH END ALLOCATION TO PRODUCTION

ORDERS
COST CENTER DEPT M

31.5.23 BONUS 200000DR 1.5.23 REVERSAL 100000CR
31.5.23
ALLOCATION 100000CR
TO PRODUCTION
ORDERS
2nd METHOD-OPEN ITEM MANAGEMENT
i) BONUS PROVISION ON 30.04.2023

ii)IN THE MONTH END ALLOCATION TO PRODUCTION ORDERS

COST CENTER DEPT M
30.4.23 BONUS 100000DR
30.4.23
ALLOCATION 100000CR
TO PRODUCTION
ORDERS
COST CENTER DEPTM VALUE WILL BE ZERO
iii)TO MAKE BONUS PROVISION ON 31.5.23

iv)COST CENTER REPORT - IN THE MONTH END ALLOCATION TO

PRODUCTION ORDERS
COST CENTER DEPT M
31.5.23 BONUS 100000DR
31.5.23
ALLOCATION 100000CR
TO PRODUCTION
73
ORDERS
3rd METHOD-ACCRUAL CALCULATION ONLY IN CO
i)SOME COMPANIES WILL NOT PREPARE PROFIT & LOSS ACCOUNT AND
BALANCE SHEET EVERY MONTH. THEY WILL NOT MAKE PROVISIONS IN THE
BOOKS.
EXPENDITURE FROM APR TO FEB WILL BE LESS.
ii) IN THE YEAR END COMPANIES TO MAKE PROVISIONS IN THE ACCOUNTS.
COMPANIES TO FOLLOW ACCRUAL BASIS OF ACCOUNTING/ MERCANTILE

BASIS OF ACCOUNTING. THEY HAVE TO MAKE PROVISIONS IN ACCOUNTS IN
THE YEAR END.
EXPENDITURE FOR MARCH WILL BE MORE
iii)IN SAP WHEN WE TAKE PRODUCTION, ENTRIES WILL BE POSTED

AUTOMATICALLY BASED ON PRODUCT COST OF THE MONTH .
PRODUCTION VALUATION WILL BE LESS FROM APR TO FEB

PRODUCTION VALUATION WILL BE MORE FOR MARCH
iv)SAP HAS GIVEN ACCRUAL ORDERS- SIMILAR TO COST SHEET.
CREATE OVERHEAD STRUCTURE
TAKE SALARIES 1000000

BONUS 10% ON SALARIES 100000 DEBIT TO COST CENTER DEPTM
CREDIT TO COST CENTER DEPTDUMMY
- NO FI DOCUMENT
COST CENTER DEPTM
30.4.23 BONUS 100000DR
30.4.23ALLOCATION
TO PRODUCTION 100000 CR
ORDERS

COST CENTER DEPTDUMMY
30.4.23 BONUS 100000 CR
v)IN THE YEAR END COST CENTER DEPTDUMMY VALUES
74
COST CENTER DEPT DUMMY
30.4.23 BONUS 100000CR

31.5.23 BONUS 100000CR
30.6.23 BONUS 100000CR
31.3.24 BONUS 100000CR

1200000CR
vi)IN THE YEAR END BONUS PROVISION IN FI i.e., : ON 31.03.2024
BONUS A/C DR 1200000 COST CENTER DEPT DUMMY

vii)IN THE YEAR END DEPTDUMMY VALUES--

COST CENTER DEPTDUMMY
30.4.23 BONUS 100000CR

31.5.23 BONUS 100000CR
30.6.23 BONUS 100000CR
31.3.24 BONUS 1200000DR 31.3.24 BONUS 100000CR

1200000DR 1200000CR
COST CENTER DEPT DUMMY VALUE WILL BE ZERO IN THE YEAR END .
CUSTOMIZATION :-
1. CREATION OF G/L MASTER BONUS ACCOUNT [ FS00 ]
--> G/L A/C : 400105

--> G/L A/C : 400100 SALARIES A/C
--> ENTER
--> CHANGE SHORT TEXT AND G/L LONG TEXT TO BONUS ACCOUNT
--> SAVE
--> SELECT EDIT COST ELEMENT BUTTON
-->VALID FROM :01.04.2023
--> ENTER
-->COST ELEMENT CATEGORY : 3 ACCRUAL / DEFERRAL PER SURCHARGE
--> SAVE
2. DEFINE CO NUMBER RANGE INTERVAL FOR BUSINESS TRANSACTION

KAZI i.e., : ACTUAL COST CENTER ACCRUAL [KANK ]
--> CO AREA:VIL
--> KEEP THE CURSOR ON KAZI
75
--> SELECT ELEMENT / GROUP BUTTION
--> ENTER
--> SAVE
3. CREATION OF COST CENTER DEPTDUMMY [ KS01 ]

--> COST CENTER : DEPTDUMMY
--> ENTER
--> CHNGE THE NAME TO DEPARTMENT DUMMY
--> CHANGE THE DESCRIPTION TO COST CENTER DEPARTMENT DUMMY
--> SAVE
4. MAINTAIN OVERHEAD STRUCTURE

PATH : SPRO --> CONTROLLING --> COST ELEMENT ACCOUNTING -->
ACCRUAL CALCULATION --> PERCENTAGE METHOD --> MAINTAIN OVERHEAD
STRUCTURE
--> SELECT CREATE OVERHEAD STRUCTURE BUTTON
--> OVERHEAD STRUCTURE :VIL1
--> DESCRIPTION :VIL OVERHEAD STRUCTURE
--> ROW 10
--> BASE : V1
--> ENTER
-->NAME : SALARIES
--> ROW : 20
--> OVERHEAD RATE:V2
--> ENTER
--> NAME : BONUS
--> DEPENDENCY : SELECT KRS1 i.e., CONTROLLING AREA
-->BONUS :FROM 10
--> TO: ENTER 10
--> CREDIT :V3
--> ENTER
--> SAVE
--> IGNORE THE MESSAGE ENTER
--> KEEP THE CURSOR ON OVERHEAD STRUCTURE VIL1
--> SELECT ASSIGNMENTS BUTTON
--> CO AREA :VIL
--> SELECT ACTUAL ACCRUAL RADIO BUTTON
--> VALID FROM :1 2023
--> VALID TO :12 2023
--> OVERHEAD STRUCTURE :VIL1
--> SAVE
76
--> DOUBLE CLICK ON OVERHEAD STRUCTURE VIL1
--> KEEP THE CURSOR ON BASE :V1
--> FROM THE MENU BAR SELECT GOTO --> CALCULATION BASE
--> FROM COST ELEMENT : 400100 SALARIES A/C
--> SAVE
--> KEEP THE CURSOR ON OVERHEAD RATE :V2
--> FROM THE MENU BAR SELECT GOTO --> OVERHEAD RATE
--> VALID : 1
--> FROM : 2023
--> VALID TO :12 2023
--> ACTUAL OVERHEAD : 10
--> SAVE
--> KEEP THE CURSOR ON V3
--> FROM THE MENU BAR SELECT GOTO --> CREDIT
--> VALID TO: 12 [ 2023 ]
--> COST ELEMENT : 400105 BONUS A/C
--> COST CENTER DEPTDUMMY
--> SAVE
END USER AREA : -

1. SALARIES POSTING FOR APR,23 [ FB01L ]

--> TYPE : SA
--> ACCOUNT : 400100 SALARIES A/C
--> ENTER
--> AMOUNT : 1000000
--> ENTER
--> AMOUNT : *
--> TEXT : +
2. ACCRUAL CALCULATION IN THE MONTH END

PATH : ACCOUNTING --> CONTROLLING --> COST ELEMENT ACCOUNTING -->
ACTUAL POSTINGS --> ACCRUAL CALCULATION [ KSA3 ]
--> COST CENTER :DEPTM

--> PERIOD :1 (APR)
77
--> SELECT NEXT LIST LEVEL BUTTON
3. TO VIEW COST CENTER REPORT [ KSB1 ]

--> POSTING DATE : 01.4.2023 TO 30.4.2023
NOTE :- DEPTM COST WILL BE ALLOCATED TO PRODUCTION ORDERS

PRODUCED DURING THE MONTH. COST CENTER DEPTM VALUE WILL BE ZERO
IN THE MONTH END. THIS WILL BE COVERED IN THE PRODUCT COSTING.
4. BONUS PROVISION IN FI IN THE YEAR END [ FB01L ]
--> DOCUMENT DATE AND POSTING DATE : 31.03.2024

--> TYPE : SA
--> ACCOUNT : 400105 BONUS A/C
--> ENTER
--> IGNORE THE MESSAGES AND ENTER
--> AMOUNT : 100000
--> TEXT : BONUS PROVISION FOR THE YEAR 23 -23
--> ACCOUNT : 100500 OUTSTANDING EXPENSES
--> ENTER
--> AMOUNT : *
--> TEXT : +
--> FROM THE MENU BAR SELECT DOCUMENT-->SIMULATE AND SAVE
5. TO VIEW COST CENTER REPORT [ KSB1 ]

--> POSTING DATE 01.04.2023 TO 31.03.2024
IN THE YEAR END DEPT DUMMY VALUE WILL BE ZERO
78
SPLITTING STRUCTURE
IF A COST CENTER IS RENDERING MORE THAN ONE ACTIVITY (WHICH ARE

ACTIVITY INDEPENDENT) THEN WE NEED TO ALLOCATE THE COST OF THE
COST CENTER TO THESE ACTIVITIES.
IF WE DO NOT DEFINE A SPLITTING STRUCTURE , SAP WILL ALLOCATE THE

COST EQUALLY AMONG THE ACTIVITIES . IF WE WANT TO ALLOCATE IN A
DIFFERENT WAY WE HAVE TO CREATE SPLITTING STRUCTURE.
IN SPLITTING STRUCTURE WE DEFINE WHICH COST ELEMENTS WILL GET
ALLOCATED TO WHICH ACTIVITY TYPE.
THIS APPLIES TO BOTH PLAN AND ACTUAL COSTS .

WE CAN ALLOCATE COST ACCORDING TO FOLLOWING CRITERIA:
 ACTIVITY QUANTITY
 EQUIVALANCE NUMBER ( RATIO)
 CAPACITY
 OUTPUT
 STATISTICAL KEY FIGURES
Eg: EARLIER WE HAVE DISCUSSED ACTIVITY PRICE CALCULATION

I. PLANNING COST CENTERWISE ( WITHOUT ACTIVITY - ACTIVITY
INDEPENDENT PLANNING ) (INPUT PLANNING KP06 )
400100 SALARIES 500000

400300 RENT 230000
720000
II. PLANNING ACTIVITY HOURS ( LABOUR HOURS ) –OUTPUT PLANNING

[ KP26 ]
VIL1 - LABOUR HOURS= 72000
III . PLAN ACTIVITY PRICE ( LABOUR HOUR RATE ) CALCULATION [ KSPI ]

LABOUR HOUR RATE =720000 / 72000 = 10Rs. /HR
SPLITTING STRUCTURE : ONLY ACTIVITY INDEPENDENT PLANNING

I. PLANNING COST CENTERWISE ( WITHOUT ACTIVITY - ACTIVITY
INDEPENDENT PLANNING ) INPUT PLANNING [ KP06 ]
400100 SALARIES 500000 LABOUR HOURS AND CLEANING HOURS

400300 RENT 220000 CLEANING HOURS AND MACHINE HOURS
720000
II . PLANNING ACTIVITY HOURS ( OUTPUT PLANNING )[ KP26 ]

VIL1 - LABOUR HOURS 50000
VIL4 - CLEANING HOURS 30000
VIL5 - MACHINE HOURS 10000
79
III. ALLOCATION
AMOUNT LABOUR CLEANING MACHINE TOTAL
SALAR 500000
IES
500000*50000/ 500000*30000/ 500000
80000=312500 80000=187500
RENT 220000 220000*30000/ 220000*10000 220000
40000= 165000 /40000=55000
TOTAL 312500 352500 55000 720000
COST
IV. PLAN ACTIVITY PRICE CALCULATION [KSPI ]

ACTIVITY LABOUR CLEANING MACHINE
COST 312500 352500 55000
HOURS 50000 30000 10000
ACTIVITY PRICE 6.25 11.75 5.50
PER HOUR
CUSTOMIZATION : -
1. CREATION OF ACTIVITY TYPE [ KL01 ]
-->ENTER
-->VALID FROM :01.04.2023
--> COPY FROM ACTIVITY TYPE :VIL1 LABOUR HOURS
--> ENTER
--> CHANGE THE NAME AND DESCRIPTION : CLEANING HOURS
--> SAVE
--> ENTER
--> CHANGE THE NAME AND DESCRIPTION : MACHINE HOURS
--> SAVE
2. CREATION OF ACTIVITY TYPE GROUP

ACCOUNTING --> CONTROLLING --> COST CENTER ACCOUNTING --> MASTER
DATA --> ACTIVITY TYPE GROUP --> CREATE [ KLH1 ]
--> ACTIVITY TYPE GROUP :VIL14GRP
--> ENTER
--> DISCRIPTION :VIL14 ACTIVITY GROUP
--> SELECT INSERT ACTIVITY TYPE BUTTON
--> SELECT ACTIVITY TYPE:VIL1 AND VIL4
--> SAVE
--> ACTIVITY TYPE GROUP :VIL45GRP
--> ENTER
--> DESCRIPTION:VIL45 ACTIVITY GROUP
--> SELECT INSERT ACTIVITY TYPE BUTTON
80
--> SELECT ACTIVITY TYPE VIL4 AND VIL5
--> SAVE
3.CREATION OF COST CENTER [ KS01]
-->COST CENTER : DEPTQ

--> REFERENCE COST CENTER : DEPTO
--> ENTER
--> CHANGE THE NAME TO DEPARTMENT Q
--> CHANGE THE DESCRIPTION TO COST CENTER DEPTARTMENT Q
--> SAVE
4. CREATION OF COST CENTER GROUP [ KSH1 ]

--> COST CENTER GROUP :VILQGRP
--> ENTER
--> DESCRIPTION : COST CENTER GROUP VILQ GROUP
--> SELECT COST CENTER DEPTQ
--> SAVE
5. DEFINE SPLITTING STRUCTURE

PATH :
SPRO --> CONTROLLING --> COST CENTER ACCOUNTING--> PLANNING -->
ALLOCATIONS --> ACTIVITY ALLOCATION--> SPLITTING --> DEFINE SPLITTING
STRUCTURE
--> STRUCTURE :V1
--> TEXT :VIL SPLITTING STRUCTURE
--> SAVE
--> SELECT STRUCTURE V1
--> DOUBLE CLICK ON SPLITTING RULES FOLDER
--> RULE :VA
--> TEXT :VIL SPLITTING RULE
--> METHOD :SELECT 12 ACTIVITY QUANTITY
--> SAVE
--> DOUBLE CLICK ON SPLITTING STRUCTURES
--> SELECT STRUCTURE V1
--> DOUBLE CLICK ON ASSIGNMENTS FOLDER
ASSIGNMENT TEXT RULE
1 LABOUR AND CLEANING VA

HOURS
2 CLEANING AND VA
MACHINE HOURS
--> SAVE
81
--> SELECT ASSIGNMENT 1
--> DOUBLE CLICK ON SELECTION FOR ASSIGNMENT FOLDER
--> COST ELEMENT FROM VALUE : 400100 SALARIES
--> ACTIVITY TYPE GROUP :SELECT VIL14GRP
--> SAVE
--> SELECT ASSIGNMENT 2
--> DOUBLE CLICK ON SELECTION FOR ASSIGNMENT FOLDER
--> COST ELEMENT FROM VALUE : 400300 RENT
--> ACTIVITY TYPE GROUP SELECT :VIL45GRP
--> SAVE
6. ASSIGN SPLITTING STRUCTURE TO COST CENTERS

-->SAME PATH
--> COST CENTER : DEPTQ
--> SELECT ALL VERSIONS RADIO BUTTON
--> SELECT CHANGE BUTTON
--> SELECT DEPARTMENT Q CHECK BOX
--> KEEP THE CURSOR ON V1
--> SELECT ASSIGN BUTTON
--> SAVE
END USER AREA :-

1. PLANNING COST CENTERWISE [ KP06 ]
--> VERSION : 0
--> FROM PERIOD :9 (DEC) TO PERIOD 9 (DEC )
--> COST ELEMENT : 400100 TO 400300
--> 400100 PLAN FIXED COST : 500000
--> 400300 PLAN FIXED COST :220000
--> SAVE
2. PLANNING ACTIVITY HOURS [ KP26]

--> VERSION : 0
-->ACTIVITY TYPE :VIL1 TO VIL5
-->VIL1 PLAN ACTIVITY : 50000
82
--> SAVE
3. COST CENTER SPLITTING [ KSV4 ]
PLANNING --> ALLOCATIONS --> SPLITTING
--> KEEP THE CURSOR ON COST CENTER DEPTQ
--> SELECT COST ELEMENTS BUTTON
--> IGNORE THE MESSAGE AND PRESS YES BUTTON
4. PLAN ACTIVITY PRICE CALCULATION [ KSPI ]

--> COST CENTER GROUP :VILQGRP
--> SAVE
--> IGNORE THE MESSAGE ENTER
5. PLANNING ACTIVITY HOURS [ KP26 ]

--> VERSION : 0
--> FROM PERIOD :9 TO PERIOD 9
-->ACTIVITY TYPE :VIL1 TO VIL5
--> SELECT FORM - BASED RADIO BUTTON
83
SUMMARY : -
1. TO UPDATE CO RECORDS COST ELEMENTS ARE REQUIRED
2. 2TYPES OF COST ELEMENTS

I . PRIMARY COST ELEMENTS-G/L ACCOUNTS
II . SECONDARY COST ELEMENTS-OTHER THAN G/L
ACCOUNTS. USED FOR ALLOCATIONS
A . CATEGORY : 42 ASSESSEMENT
PRIMARY COST POSTINGS AND SECONDARY COST ALLOCATIONS
B . CATEGORY : 43 INTERNAL ACTIVITY ALLOCATION - ALLOCATION OF
ACTIVITY HOURS
3. COST CENTER - TO VIEW DEPARTMENTWISE COST
4. COST CENTER GROUP - TO VIEW NUMBER OF COST CENTERS DATA AT A

TIME
5. COST ELEMENT GROUP - TO VIEW NUMBER OF COST ELEMENTS DATA AT A

TIME
6. REPOST CO LINE ITEM -AT THE TIME OF POSTING FI PERSON DOES NOT
KNOW WHICH COST CENTER TO POST. POST TO COMMON COST CENTER. CO
PERSON WILL TRANSFER FROM COMMON COST CENTER TO RESPECTIVE COST
CENTERS. TRANSFER DOCUMENTWISE / LINE ITEMWISE
7. REPOST COST-WHEN WE SPLIT A COST CENTER INTO NUMBER OF COST

CENTERS OR WRONG COST CENTER POSTINGS. TRANSFER COST
ELEMENTWISE OR G/L ACCOUNTWISE.
8. ONLINE RECONCILIATION LEDGER OR REALTIME INTEGRATION OF

CONTROLLING WITH FINANCIAL ACCOUNTING: WHEN WE TRANSFER DATA
FROM ONE COMPANY CODE COST CENTER TO ANOTHER COMPANY CODE
COST CENTER - BOTH COMPANY CODES ARE UNDER THE SAME CONTROLLING
AREA AND USING SAME CHART OF ACCOUNTS.
9. STATISTICAL KEY FIGURES -ALLOCATION BASED ON NUMBER OF

EMPLOYEES/AREA/TELEPHONE CALLS
10 . ACTIVITY TYPE - MACHINE HOURS / LABOUR HOURS- BASED ON NUMBER

OF MACHINE HOURS USED / BASED ON LABOUR HOURS USED
11. ACTIVITY INDEPENDENT PLANNING - PLANNING WITHOUT ACTIVITY TYPE

- PLAN ONLY FIXED COST .
12. ACTIVITY DEPENDENT PLANNING - PLANNING WITH ACTIVITY TYPE -PLAN

FIXED COST AND VARIABLE COST
84
ALLOCATION OF SENDER COST CENTER COST BASED ON HOURS SUPPLIED BY
SENDER COST CENTER TO RECEIVER COST CENTERS.
14 . INDIRECT ACTIVITY ALLOCATION

ALLOCATION OF SENDER COST CENTER COST BASED ON PRODUCTION OF
RECEIVER COST CENTERS.
15. PERIOD END CLOSING

MONTH END ALLOCATION OF COST FROM SERVICE COST CENTER TO
PRODUCTION COST CENTERS
A . BASIS OF ALLOCATION- FIXED AMOUNT/ PERCENTAGE/ ACTIVITY TYPES /
STATISTICAL KEY FIGURES
B. ALLOCATION METHODS
I . ASSESSMENT - TRANSFER PRIMARY COST POSTINGS AND SECONDARY COST
ALLOCATIONS
II . DISTRIBUTION - TRANSFER ONLY PRIMARY COST POSTINGS -SENDER
SHOULD BE A COST CENTER
III . PERIODIC REPOSTING - TRANSFER ONLY PRIMARY COST POSTINGS-
SENDER CAN BE A COST CENTER OR ORDER
IV. INDIRECT ACTIVITY ALLOCATION - TRANSFER QUANTITIES AS WELL AS
VALUES
C . CYCLE - TO CREATE CYCLES - WE CAN CREATE NUMBER OF CYCLES OR

NUMBER OF SEGMENTS IN A CYCLE
D . SCALE NEGATIVE TRACING FACTOR - IF RECEIVER COST CENTER

QUANTITIES ARE NEGATIVE HOW TO ALLOCATE COST.
16. PLANNING COST CENTERWISE FOR NEXT YEAR BASED ON ACTUALS OF

CURRENT YEAR - WITH REVALUATION
17. ACCRUAL ORDERS / IMPUTED COST CALCULATION: TO MAKE PROVISIONS

ONLY IN CONTROLLING
18 . COST CENTERWISE PLANNING / ACTUALS POSTING / TO VIEW VARIANCE

REPORT.
19. DISTRIBUTION KEYS - WHEN WE PLAN FOR WHOLE YEAR - HOW TO

DISTRIBUTE PER MONTH
20. SPLITTING STRUCTURE - ONE COST CENTER COST ELEMENTS ALLOCATION

TO NUMBER OF ACTIVITY TYPES
85

CONTROLLING BASICS AND COST CENTER ACCOUNTING VIL (2)

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CONTROLLING BASICS AND COST CENTER ACCOUNTING VIL (2)

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CONTROLLING (CO)

THIS IS USED FOR INTERNAL REPORTING. IN CONTROLLING (CO)

1) BASIC SETTINGS FOR CONTROLLING

A) MAINTAIN CONTROLLING AREA

2) COST ELEMENT ACCOUNTING

TO UPDATE FI RECORDS GENERAL LEDGER ACCOUNTS ARE REQUIRED.

3) COST CENTER ACCOUNTING

THIS IS USED TO VIEW DEPARTMENTWISE COST. IN ORGANIZATIONS THERE

5) CLASSIC PROFIT CENTER ACCOUNTING

UPTO 4.7EE(OLD) VERSION PROFIT CENTER ACCOUNTING WAS PART OF

FROM ECC6(NEW) VERSION PROFIT CENTER ACCOUNTING IS PART OF

HERE WE DISCUSS THE DIFFERENCES BETWEEN CLASSIC PROFIT CENTER

THIS IS USED FOR VALUATION OF INVENTORIES i.e., WORK IN PROCESS AND

VALUATION OF FINISHED GOODS IN THE BEGINNING WILL BE DONE AT

SAP HAS GIVEN 2 SCENARIOS FOR STANDARD COSTING.

A) CREATION OF COST ESTIMATE WITH QUANTITY STRUCTURE(THIS IS USED

IN THE MONTH END WE GET ACTUAL COST. FOR ACTUAL

A) PRODUCT COST BY ORDER( PRODUCTION ORDER)

7) PROFITABILITY ANALYSIS (CO-PA)

THIS IS USED TO VIEW PROFITABILITY FOR NUMBER OF PARAMETERS AT A

8) ECC6 NEW FEATURES

9) MATERIAL MANAGEMENT (MM) MODULE TO FINANCIALS(FI) MODULE AND

11) PRODUCTION PLANNING(PP) MODULE TO FINANCIALS (FI) MODULE AND

12)GOODS AND SERVICES TAX(GST)-CIN i.e., COUNTRY INDIA VERSION

13) SPECIAL SCENARIOS

A) ACTIVITY TYPES i.e., MACHINE HOUR/LABOUR HOUR RATE CALCULATION

AN ORGANIZATIONAL UNIT WITHIN A COMPANY USED TO REPRESENT A

FOR CONTROLLING MODULE CONTROLLING AREA IS MANDATORY.

IT RECORDS ALL OVERHEAD RELATED ACTIVITIES i.e., COST CENTER

COMPANY CONTROLLING AREA

PROFIT CENTERS COST CENTERS

WHEN WE COMBINE FI AND CO- WE WILL HAVE 2 SCENARIOS

CONTROLLING AREA AT COMPANY CODE LEVEL

COMPANY CODE = CONTROLLING AREA

PROFIT CENTER WILL BE ASSIGNED IN COST CENTER. EACH COMPANY CODE

CONTROLLING AREA AT COMPANY(GROUP) LEVEL. NUMBER OF COMPANY

PROFIT CENTER WILL BE ASSIGNED IN COST CENTER.

WHICH SCENARIO COMPANIES WILL CHOOSE : -

B) WHERE MANAGEMENT WANTS TO VIEW NUMBER OF COST CENTERS DATA

C) WHERE THE ACTIVITIES ARE DIFFERENT

- CEMENT MANUFACTURING STEEL MANUFACTURING

D) WHERE THE ACTIVITIES ARE SAME

IF WE GO FOR 1ST SCENARIO

COMPANY CODE SHOULD BE THE CONTROLLING AREA CODE

IF WE GO FOR 2ND SCENARIO :-

PATH: SPRO --> CONTROLLING --> GENERAL CONTROLLING -->

--> DOUBLE CLICK ON MAINTAIN CONTROLLING AREA

COST CENTER STANDARD HIERARCHY :-

A TREE LIKE HIERARCHY STRUCTURE GROUPING ALL THE COST CENTERS OF A

-->COST CENTER STANDARD HIERARCHY : VILHIER

COST CENTERS DEPTM DEPTN DEPTO

WHEN WE WANT TO SEE COST CENTER DEPTM DATA - IN THE REPORT

2. MAINTAIN NUMBER RANGES FOR CONTROLLING DOCUMENTS

FI POSTING USING TRANSACTION CODE - FB01L

Eg : - SALARIES A/C DR 100000 COST CENTER : DEPTM

AT THE TIME OF POSTING IN FI , FI USER DOES NOT KNOW WHICH COST

FOR THAT TRANSFER NO FI DOCUMENT WILL BE GENERATED

IN THIS METHOD THERE ARE 2 SCENARIOS :

SALARIES DR 800000 COST CENTER:

TRANSFER TO DEPTM 400000