standard cost calculation

[Former Member]

Hi gurus,

As a sap fico consultant, how we can finalise the standard cost of a particular product. for ex

As per as client details: if u want to finalised the finished product of 100 units u need to spend the labour 2000, power 10 units @ 4/- and the fuel is 10 liters @ 60/- like this.

Here how can u calculate standard cost: My doubt is

1) can we manuvally calculate the standard cost first or not

2) where we have to enter the product of 100 units

3) if 100 units is finisalised then the client need to check what is the cost of 200 units cost, then what to do for this.

thanqu

raj

[Former Member]

Hi Rajesh,

1)

a) Cost of labour can be captured thru Routing for the finished product, for which you want to estimate std cost. Routing will be prepared by PP.

b) Maintain activity rates ( for the activity type and the cost center, which the PP team is using for Routing) for the combination of cost center and the activity type, in Tcode KP26.

2) Define power as an activity type and maintain Routing for the same. Maintain the power rates ( i.e @ Rs4/- per unit), for the combination of power cost center and power activity type in Tcode KP26.

3) Regarding the calculation base, i.e the qty , for std cost estimate, we have the option to maintain the calculation base in Costing type ( hopefully). However, at the time of Std cost estimate also, you have the option to change the cost estimate to any qty, I.E you can input the Qty , for which you want to calculate std cost estimate.check this option in CK11N.

Pl revert for further clarifications, if any.

Best Regards,

Santosh

[Former Member]

Hi Rajesh,

Thanqu for quick replay, and my doubt is, for ex

Total Labour cost is = 20,000/-, Power is :5,000/- & Fule is : 2,000/-, then the total cost is 27000/-.

IN KP26 : u enter 20,000/- with cost element, it is ok

then IN KP26: U enter here the activity hours, then how can we calcuate hours for labour.

can u help please

raj

[Former Member]

Hi!

For calculating activity hours (labor hours) you have to define formula for all your relevant resource (work center) on which you are performing different activities. This formula generally is defined by PP module.

So, based on std. rates maintained in your master recipe (routing), it will cpature the actual rates of labor from this formula and no. of hours actual confirmed during confirmation of Process order in PP. For plan activity rates it will refer KP26 for this formula.

Hope it will clear to you. Pls get back for further query on the same.

Thanks & Regards,

Taral Patel

[Former Member]

Hi tara

thanqu for ur quick replay, in KP26 we have to mentctioned plan activity hrs or plan activity proce.

can u eaxplain please

thanqu

raj

[Former Member]

Hi!

Std. activity hours are specified in master recipe and rate is specified in kp26 against that activity type.

Hope it will clear to you. pls get back for further query.

Thanks & Regards,

Taral Patel

[Former Member]

Hi thanqu ur

here my question how can u calculate standard hours for a particular product (kp26). can u give me some info for this, normally, client gave only I need to prepare 100 units, the toal labour cost of that product is 2000/- this is the information. then how to calculate the information. can u eaxplain

thanqu

raj

[Former Member]

Hi!

For calculation on this some standard formula also has already provided by SAP in Create Resource (CRC1 t.code). Through those formulas, you can derive your std. hours also. One of the formula would be like :

Std. labor hours = (Operational hours / Base hours)*No. of labors working on that production line

This resource ofcourse will be attached with your routing (Master Recipe) and from there std. hours will be defined in Master recipe. Also requesting you to take the help from your PP cosultant for the same. Also for calculation of this std. one, first of all you need to have std. data like you have mentioned as per your business.

Hope it will clear to you.

Thanks & Regards,

Taral Patel

[Former Member]

ya thanqu ur what i need also same,

some of my friends told me, calculate standard hour manually, then enter KP26 standard hours, and enter amoutn in KP06. then the system it takes through the routing. can u give me some info to calucation formula for labour, power and fule.

if u want to produce a finished product of 100 units. then the labour cost is 10000/-, fuel 200/- and power is 300/- per unit. how can we calculate formula here and there the labour cost and fuel and power also different units here we need to calculate difference formula.

can u please advise for this

thanqu

raj

[Former Member]

Hi Raja!

The way I have suggested is through SAP system. But info for calucation of formula for labour, power and fuel - I think that is purely business call. In our implementation for calculating the power consumption our business people collected data from plant for different production linewise as per actual business.

We made calculation for different production line according to those std. data collected by our business people. Same thing we did for calculation of std. labor hours after collection of required business data for our different production lines. In short to find std. hours for these are dependent on our business and the formula which we define in SAP will calculate your actual hours after confirmation of process order or production order.

Hope it will clear to you. Pls get back to me for further query.

Thanks & regards,

Taral Patel

[Former Member]

thanqu for ur replay,

once i chek it and i will be back to u

thanqu

raj