4/10/2015 MaterialLedger+ActualCosting(PUP)|SCN

http://scn.sap.com/community/epm/accountingandfinancialclose/blog/2013/01/07/materialledgeractualcostingpup 1/4

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1.MaterialLedger+ActualCosting(PUP)

1.1PeriodicUnitPriceDuringthePeriodDuringtheperiodalltransactionsarevaluedatstandardcostasapreliminaryvaluationSAPcollectsallvaluationrelevanttransactiondatainthematerialledgerforaperiodPriceDifferencesExchangeratedifferencesProductionvariances

Differencesfromthepreliminaryvaluationpricearepostedtopricedifferenceaccounts1.2PeriodicUnitPriceMonthend:SinglelevelPricedeterminationSAPcalculatesthePUPbasedonthesumofthepricedifferences,exchangeratedifferencesandproductionvariancesinrelationtothecumulativeinventoryquantityandvalueWeightedaveragecostisusedtodeterminePUPPUPupdatedinMaterialMaster(statistical)Novariancesarerolledtothenextproductionlevel1.3PeriodicUnitPriceMonthend:SinglelevelPricedeterminationOnlymovementscollectedinthematerialLedgerforreceiptsandotherinward/outwardmovementswilleffectthePUPConsumptionhasnoeffectontheprice1.4PeriodicUnitPriceMonthend:MultilevelPricedeterminationAnactualquantitystructure(BOM)iscreatedforallmaterialswithinaplantbasedongoodsmovementsVariancesassociatedwithconsumptionoflowerlevelmaterialsarerolleduptothehigherlevelsofthisactualstructure2.Scenario

2.1ReceiptandinvoicingofrawmaterialFinishedProductFP01createdfromsingleRawMaterialRM01.PricevariancesonreceiptofinvoiceforRM01.ProductionOrderutiliseshalfofRM01stockandincurslotsizevariances.AllFP01soldinperiod.RM01Std@$10/ton

MaterialLedger+ActualCosting(PUP)PostedbyFernandoAlmeidainAccountingandFinancialCloseonJan7,20133:45:20PM

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4/10/2015 MaterialLedger+ActualCosting(PUP)|SCN

http://scn.sap.com/community/epm/accountingandfinancialclose/blog/2013/01/07/materialledgeractualcostingpup 2/4

FP01Std@$20/ton

2.2ProductionOrdercostingandsettlementRM01Std@$10/tonFP01Std@$20/ton

2.3SaleoffinishedmaterialRM01Std@$10/tonFP01Std@$20/ton

2.4PuPcalculationandposting

4/10/2015 MaterialLedger+ActualCosting(PUP)|SCN

http://scn.sap.com/community/epm/accountingandfinancialclose/blog/2013/01/07/materialledgeractualcostingpup 3/4

2.5PeriodicValuationRM01Std@$10/tonPUP@$15/tonFP01Std@$20/tonPUP@$30/tonSales@$40/ton

3.Analysis StandardPrice MovingAverage

Features AllinventorypostingsarecarriedoutatthestandardpriceVariancesarepostedtopricedifferenceaccountsPricechangescanbemonitored

Goodsreceiptsarepostedatthegoodsreceiptvalue.MaterialpricereflecttheactualpriceincurredPricedifferencesdonotoccurexceptinrarecircumstances

Pros EnsuresconsistentcostmanagementoftheproductionprocessandmakesvarianceswithinproductiontransparentCanbeusedasbenchmarktocomparethecontributionmarginsofamaterialindifferentmarketsegmentsinProfitabilityAnalysis

Variancesoccurringbothformaterialsproducedinhouseaswellasmaterialsprocuredexternallycauseanupdateinthematerialpriceandthematerialstockvalue

Cons Doesnotreflecttheactualcostsincurredduringtheperiod.Thiscanleadtoinexactvaluationpricesformaterialswhoseprocurementpriceschangeagreatdealoveraperiod,orwhosemethodofproductionchangeswithinaperiod.

Thisproblemincreasesinmultilevelproductionwitheachnewproductionstep.Thismeansthatthecostsforthe

PriceusedtovaluateamaterialconsumptionisalmostcompletelydependentonthetimeatwhichthegoodsissueispostedinthesystemNoconsistentcostmanagementofproductionprocess.Theeffectofchangesintheproductionprocess,forexample,arenotrecognizableinthefinishedproduct,andcomparingresultsfromdifferentareasinProfitabilityAnalysisis

4/10/2015 MaterialLedger+ActualCosting(PUP)|SCN

http://scn.sap.com/community/epm/accountingandfinancialclose/blog/2013/01/07/materialledgeractualcostingpup 4/4

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finishedproductmaynotreflectthemostrecentdata.Thematerialstockvaluedoesnotreflectthecurrentprocurementcosts,asvariancesfromthestandardpricearecollectedinapricedifferenceaccountinFinancialAccountinganddonotleadtoacorrectionofthematerialstockaccount.Thevariancescollectedinthepricedifferenceaccountcannolongerbeassignedtotheindividualmaterial.

notreallymeaningfulduetolackofabenchmark

Anymistakeenteringdatacancauseimmediateandunwantedchangesinthematerialprice.Anygoodsissuespostedfollowingthiserrorwillbevaluatedimmediatelywiththisincorrectmaterialprice

6699Views Tags:material,cost,ledger,ml

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7Comments

Like(1)

ThummalapentaSudhakarraoJan24,20134:47PM

Verygoodexplanationregardingpricingofmaterials

Like(0)

VenkatEmaniMay6,20133:23AM

Excellentexplanation!!

Like(0)

DevendraMohanMay6,20137:31AM

Wonderfulexplanationofpricingofmaterialsinfulllengthandaveryappropriateexplanation

Like(0)

TrinathGujariJan13,20142:26PM

greatjobinformativedocument

Like(0)

SadeghEbnoddinOct23,20143:01PM

thankyoudear Fernandothisisaveryclearandinformativedocument.ireallyenjoyed.goodlockinyourjob

Like(0)

IralaDamodarareddyDec3,20148:48AM

Greatprovidedwithclearsteps.

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Julie(PHANTHITHUHUONG)Apr6,20158:30AM

Nicedocument...