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ActualCosting/MaterialLedgerActualCosting/MaterialLedger(COPCACT)SAPLibrary

TheBestRunBusinessesRunSAP

EnterpriseManagement

SAPERP

6.0

ActualCosting/MaterialLedger
PurposeofActualCosting/MaterialLedger
Objectives
Theapplicationcomponent ActualCosting/MaterialLedger fulfillstwobasicobjectives:theabilitytomanage
materialpricesinmultiplecurrencies/valuations,andactualcosting.

MultipleCurrencies/Valuations
Afundamentaltaskofthematerialledgerismanaginginventoriesinmultiplecurrenciesand/orvaluations.
Materialinventoryvaluesarenormallymanagedbythesysteminonlyonecurrency(companycodecurrency).
Thematerialledgerenablesthesystemtomanageinventoryvaluesintwoadditionalcurrencies/valuations.
Thisisachievedbyupdatingallgoodsmovementsinthematerialledgerinuptothreecurrenciesorvaluations.
Currencyamountsaretranslatedintoforeigncurrenciesathistoricalexchangeratesdirectlyatthetimeof
posting.Businessesinhighinflationcountriescanthereforemanagetheirinventoriesinamorestablecurrency
(suchasUSdollars).Thisrevealsinflationaryeffectsoninventoryvalues.

Ifyouusetransferpricestorepresentvalueflowsinyourcompanyindifferentvaluationviews,youneedthe
materialledger.Itallowsyoutomanageyourinventoriesinthreedifferentvaluations:legalvaluation,valuation
forreportingpurposes,andprofitcentervaluation.

BeforeactivatingtheMaterialLedger,makesureyouknowwhichcurrencies/valuationsyouwanttouse,as
youcannotgobackandchangethesettinglater.

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Notethattheactivationofthematerialledgerisaprerequisiteforusingmultiplevaluations.

Exchangeratedifferencesariseifcurrenciesaresubjecttoexchangeratefluctuationsbetweengoodsreceipt
andinvoicereceipt.Thesystempoststheexchangeratedifferencestotherelevantmaterialinventoryaccount
attheendoftheperiodaspartofactualcosting(standardpostinglogic),ormanagestheexchangerate
differencesseparatelyfromtheinventoryaccountasnotrelevanttoinventory(alternativepostinglogic).
Formoreinformationaboutexchangeratedifferencesandpostinglogic,seeAlternativePostingLogic:Posting
ExchangeRateDifferences

ActualCosting
Actualcostingexpandsuponthefunctionsoftheapplicationcomponentswiththepurposeofdetermining
actualcostsforexternallyprocuredmaterialsandmaterialsproducedinhouse.Inaddition,actualcostinguses
actualcoststovaluateinventoriesofrawmaterials,semifinishedproducts,andfinishedproducts.
Actualcostingcalculatesanactualprice(periodicunitprice)foreachmaterial,intowhichallactualcostsfor
theparticularperiodflow.

ConceptBehindActualCosting
Actualcostingvaluatesallgoodsmovementswithinaperiodatthestandardprice(preliminaryvaluation).At
thesametime,allpriceandexchangeratedifferencesforthematerialarecollectedinthematerialledger.
Attheendoftheperiod,anactualpriceiscalculatedforeachmaterialbasedontheactualcostsoftheperiod.
Theactualpricethatiscalculatediscalledthe periodicunitprice andcanbeusedtorevaluatetheinventory
fortheperiodtobeclosed.Inaddition,youcanusethisactualpriceasthestandardpriceforthenextperiod.
Formoreinformation,seePriceChanges
Actualcostingdetermineswhatportionofthevarianceistobedebitedtothenexthighestlevelusingmaterial
consumption.TheactualBOMenablesvariancestoberolledupovermultipleproductionlevelsallthewayto
thefinishedproduct.Additionally,youcanchoosetohavevariancesfromcostcentersandbusiness
processesalsotakenintoaccount.
Subsequentallocationofthecostvariancestotheparticularcostobject(productionorder)isnotpossible.This
istoensureconsistentcostmanagementwithinaproductionarea.
Theactualcostingfurtherdetermineswhatportionofthevarianceistobeassignedtointernalmaterial
consumptionandsales.Thisportioncanbesubsequentlydebitedtotheconsumptionaccounttowhich
materialconsumptionhasbeenposted(revaluationofconsumption).Inthecaseofasale,thecostofsales
canberevaluatedtoactual.Inadditiontotheconsumptionaccount,theCOaccountassignmentobject(such
asthecostcenter)towhichthematerialconsumptionhasbeenposted,canberevaluated.
WorkinProcess(WIP)canalsobeincludedinActualCosting.Ifmaterialconsumption(oractivity
confirmations)havebeenpostedforproductionordersthathaveonlybeenpartiallydeliveredinthesettlement
period(orevennotdeliveredatall),thisconsumptionintheactualquantitystructureispartly(orwholly)
assignedtotheworkinprocess.Thevariancesforthematerialconsumption(oractivityconfirmations)
assignedtotheworkinprocesscanbesubsequentlydebitedtotheWIPaccounts(WIPrevaluation).This
meansthattheworkinprocesscanberevaluatedattheactualcostsofthecomponentsandactivities.

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Iftheworkinprocessiscanceledinthefollowingperiodsbythefinaldeliveryoftheproductionorders,the
variancessubsequentlydebitedtotheWIPaccountscanbeallocatedtotheproducts.
Valuatingthematerialstockswiththeperiodicunitpriceprovidesamethodofvaluationusingactualcosts
whileavoidingproblemsassociatedwithusingthemovingaveragepriceforthematerialvaluation.Formore
information,seePriceControlwithandWithouttheMaterialLedger.Preliminaryvaluationofgoodsmovements
usingthestandardpricemakesaconsistentandreliablecostmanagementofyourproductionprocess
possible,whilemakingvarianceswithinproductiontransparent.ActualCostingthereforecombinesthe
advantagesofpricecontrolusingthestandardpricewiththeadvantagesofthemovingaverageprice.The
perioddependencyoftheactualpricesupportsperiodiccostmanagement.
Revaluatinginventoriesattheendoftheperiodwiththeperiodicunitpriceisoptional.Therefore,thefunctions
ofactualcostingcanbeusednotonlytocalculateactualcosts,butarealsousefulforinformationpurposesin
conjunctionwithothercostaccountingsystems.TheActualCosting/MaterialLedgercomponentthereforedoes
notjustcollectandcalculateactualcosts,italsotracksvariancesagainstthestandardcosts.
Duetotheabilityofactualcostingtorollupcostsandperformfinalcostingatactualcosts,itisparticularly
interestingforbusinessesthatusealargenumberofrawmaterialswithproductionprocessesthathave
multiplelevels.Businessesthathavehighinventorylevelsandareinterestedinanalyzingtheirinventoryand
consumptioncostvariancesmorecloselycanalsousethefunctionsprovidedbyactualcosting.
Bycalculatingactualpricesformaterials,actualcostingcanaidyouinmakingdecisionssuchaswhetherto
makeorbuy.Becausedatainactualcostingisupdatedattheleveloftheprocurementalternatives,itis
possibletocomparedifferentsourcesofsupply.

ActivationOptions
Ifyouwanttousethe ActualCosting/MaterialLedger componenttomanagematerialinventoryvaluesin
multiplecurrencies/valuations,youmustactivatethematerialledger.Inaddition,youcanchoosetransaction
basedpricedetermination( PriceDetermination indicatorinthematerialmasterrecord=2).Formore
information,seeTransactionBasedMaterialPriceDetermination.Ifyoudothis,youstillhavetheoptionof
decidingbetween standardprice and movingaverageprice asthepricecontrolforyourmaterials.Notethe
recommendationsfromSAPregardingthisunderPriceControlwithandWithouttheMaterialLedger
Ifyouwantthesystemtocalculateaperiodicunitpriceforyourmaterialsbasedontheactualcostsincurredin
aperiod,youneedtoactivateactualcostinginadditiontoactivatingthematerialledger.Inaddition,youmust
choosesinglelevel/multilevelpricedeterminationforyourmaterials( PriceDetermination indicatorinmaterial
masterrecord=3).Inthiscase,youmustusepricecontrol standardprice forallmaterialsthatyouwantto
useinactualcosting.Forfurtherinformation,seethefollowing:
SingleLevelMaterialPriceDetermination
MultilevelPriceDetermination
PeriodicMaterialValuation
PeriodicActualCosting
Ifyouwanttoincludevariancesfromcostcentersandbusinessprocessesinadditiontothematerialcost
variancesinActualCosting,youneedtoactivateactivityconsumptionupdateinthequantitystructurein
additiontoactivatingActualCosting.

Constraints

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The ActualCosting/MaterialLedger componentcannotbeusedwiththeSAPIndustryBusinessSolution SAP

Retail

ActualCosting/MaterialLedgerIsActive
TheMaterialLedgerIsActive
Ifyouhaveactivatedthematerialledgerinaplant,youcanupdatevaluatedgoodsmovementsinmultiple
currenciesandvaluations.
Formoreinformation,seeMultipleCurrenciesandValuationsforMaterials.
Whenyouhaveactivatedthematerialledger,youcanchoosebetweenthefollowingoptionsformaterialprice
determination:
TransactionBasedMaterialPriceDetermination
Formoreinformation,seeTransactionBasedMaterialPriceDetermination.
Periodicmaterialpricedetermination
Ifyouwanttodeterminematerialpricesbyperiod,youcanchoosebetweenthefollowingoptions:
Singlelevelmaterialpricedetermination
Multilevelmaterialpricedetermination
Foradditionalinformationaboutsinglelevelpricedetermination,seethefollowing:
PeriodicMaterialValuation
PeriodicActualCosting
Formoreinformationaboutthemultilevelpricedetermination,see:PeriodicActualCosting.
Formoreinformation,seePriceControlandMaterialPriceDetermination.

PrerequisitesforPeriodicMaterialPriceDetermination
Ifyouwanttoperformsinglelevelmaterialpricedeterminationforamaterial,makesurethatthefollowing
prerequisitesarefulfilled:
Thematerialledgerisactiveforthatmaterial.
ThepricecontrolindicatorinthemasterrecordoftherelevantmaterialissettoS.
Thepricedeterminationindicatorinthemasterrecordoftherelevantmaterialissetto3.
Ifyouwanttoperformmultilevelmaterialpricedetermination,makesurethatactualcostingisactive.

Constraints

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Thematerialledgeronlysupportsactiveingredientmanagementfortransactionbasedmaterialprice
determination.

Seealso
Foradditionalinformation,seeActualCosting/MaterialLedger

C OPYR I GH T BY SAP SE OR AN SAP AF F I LI AT E C OM PAN Y. ALL R I GH T S R ESER VED . PR I N T ED F R OM SAP H ELP POR TAL.
(ht t p: / / help. s ap. c om )

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