Discrete manufacturing can we use default rule PP2

[Former Member]

Hi Experts,

I have gone through all the relevent threads but still need clarification on below

1. My client suing discrete manufacturing but want to calculate variances by period so can we use PER for Discrete manufacturing.

2. If yes then how the WIP will be calculated.

3. we have inprocess scrap at middle of operations (CK11N) and user wants to know the cost of the scrap to be book to FI, but as per iknow and from the my findings we cannot value scrap entered in CK11n or can this also be resolved if we use PER.

Kindly help me.

Thanks,

Sudha

[ajaycwa1981 · Accepted solution]

Hi Sudha

1. Yes, you can use PP2 for Discrete Mfg.. I myself used it once and could not find any issues out of it

2. WIP will be valuated at Target cost as per Periodic Cost scenario

3. PER for FUL dont have any impact on Scrap valuation and accounting... If there is scrap, you can confirm the scrap from QA transactions and the same will get charged to the Prod Order

br, Ajay M

[Former Member · Accepted solution]

Hi Ajay,

Thank you for the update and i have gone through lot of your replies int he forum and got the so many useful information.

Can you please provide some more inputs on below:

1. Scenario: we have 5 operations created PO for qty 100 and in operation 3 we put the yield as 90 and scrap 10 and for the other operations we have confirmed qty 90.

and GR for 50.

According to PER we will get Variance on qty 50 for the month end and WIP for 40 right, in that case where we can get the value of qty 10 scrap.

2. if we use the PER then no need to close the Production order and re open again right. The reason for asking this question is user is in legacy system and they used to close all PO book the difference to variance and reopen in next period.

I think this is not the SAP best Practice to proceed.

Kindly provide your valuble inputs on this.

Thanks,

Sudha

[Former Member · Accepted solution]

Hi Ajay,

Can you please elaborate on " use QA transactions and that will recharge to Production order".

Thanks,

SUdha

[former_member184655 · Accepted solution]

Dear Sudha,

Using QA32 for clearing the production lot can be used for posting as un-restricted stock or blocked stock or as scrap.

In this case it's the final product itself is getting scrapped and it seems in your case its inprocess scrap.

Check and revert

Regards

Mangalraj.S

[Former Member · Accepted solution]

Hi Raj,

Yes in our case we are using in process scrap on RM itself not on Finished product.

requirement is like user wants to valuated that scrap at that time (operation 30) only and book it to financials.

Kindly provide inputs.

Thanks,

Sudha

[ajaycwa1981 · Accepted solution]

Hi Sudha

yes, you dont need to close and reopen the prod orders each period

If you are sure that Scrap will be generated and it has realizable value - Maintain a new mat code for Scrap and enter a -ve qty in the BOM for it.. This wil then treated as By Product and GRed from 531 mvt type i guess

If you scrap it from Quality Inspection transaction - Then it will be the same FG code getting scrapped and the cost of it gets charged to the same prod order

br, Ajay M

[Former Member · Accepted solution]

Hi Ajay,

Thank you.

Scrap is operational and unplanned scrap there is not planned scrpa to include in the BOM.

Say for example following is the scenario then where we can see the Scrap value as per PER

Scenario: we have 5 operations created PO for qty 100 and in operation 3 we put the yield as 90 and scrap 10 and for the other operations we have confirmed qty 90.

and GR for 50.

According to PER we will get Variance on qty 50 for the month end and WIP for 40 right, in that case where we can get the value of qty 10 scrap.

Thanks,

Sudha

[former_member184655]

Dear Sudha,

1.In case if you want to carryout periodic variance calculation and settlement then a PCC(Product cost collector) should exist

for the material.In my understanding when the client is running their business in order based(Discrete Manufacturing) then

generally the production order remains as the cost collecting object.

2.Still if period based costing is to be used means then include the check box for product cost collector in the controlling tab

page for the order type dependent parameters in OPL8 for the plant and order type combination.

3.Are you meaning the scrap posted during confirmation(operation confirmation) using CO11N?

Check and revert

Regards

Mangalraj.S