## Pages

### Costing sheet

Use of costing sheet:

In the costing sheet, you determine the following:
• The direct costs to which overhead is applied (calculation base)
• The conditions under which overhead is applied (dependency)
• Whether overhead is calculated on a percentage basis or on a quantity basis
• The amount of the overhead percentage, or the amount of overhead for each unit of measure
• The validity period for the overhead
• Which object (cost center or order) is credited, and under which cost element for actual postings (credit key)
IMG à Controlling à Product Cost Controlling à Product Cost Planning  à Basic Settings for Material Costing à Overhead à Maintain Overhead Cost Elements

Calculation Base:
IMG à Controlling à Product Cost Controlling à Product Cost Planning  à Basic Settings for Material Costing à Overhead à Costing Sheet: Components à Define Calculation Bases

The calculation base determines to which cost elements overhead is applied together.
We will define 2 bases on which overheads will be calculated:-
1)  Materials
2)  Wages

### Product Costing fastfacts

Define calculation base
Define costing sheets
Define cost component structure:
Define structure
Define cost component
Assign cost elements to cost components

Product costing is a tool for planning costs and establishing prices for materials. It is used to calculate the costs of goods manufactured and the costs of goods sold for each product unit.

If costing is carried out on the basis of data in Production Planning (PP), then the cost estimate is a product cost estimate with a quantity structure (for example, BOM and routing). If costing is carried out on the basis of data that you enter manually, then the cost estimate is a product cost estimate without a quantity structure.
Product costing belongs to both the Production Planning (PP) Module and the Controlling (CO) Module.

Cost Object Controlling is used in the following areas:

§ Order Related Production.

§ Repetitive Manufacturing.

§ Process Manufacturing.

§ Sales Order Related Production.

§ Engineer to Order.

### Maintaining number range in Controlling area KANK

We can create new number range from scratch or copy from the standard Controlling area 0001.
Usually just to make sure the data consistency we do not copy number ranges but rather create.

### Controlling area OX06

Controlling area is an organizational unit within a company that represents company for cost accounting purpose.
Controlling area can have more then one company code assigned to it, but one company code can have one and only one controlling area. All company codes under same credit control are must have same operative charts of accounts.
IMG --> Controlling --> G/L--> organization --> Maintain controlling area   OX06

Use CoCd --> CO area if your company code is same as the controlling area and you have just one company code in the controlling area otherwise use second option.

### Cost element group KAH1

Accounting → Controlling→ Cost Element Accounting (or Cost Center Accounting) → Master data → Cost element groups → Create/Change/Display.

Cost element group used for collecting similar characteristics in same groups.
Cost element group structure used for row structure for reporting purpose.

### Cost elements: Primary & Secondary

Cost center is a cost element classifies the organization's valuated consumption of production factors within a controlling area.
Cost center is an organizational unit within a controlling area that represents a defined location of cost incurred. It can be defined based on various criteria such as functional requirements, allocation criteria,physical location etc.
Primary Element
Primary costs that originate outside the company; relate directly to the income statement in FI and must be
included in the FI Chart of Accounts.
All Primary cost elements gets linked to Income statement.
Secondary Element
Secondary costs that result from internal allocation activities; NO relation to G/L accounts in FI. These
accounts are exclusively for cost accounting and are only maintained in CO.