Plan vs Actual activity price calculation

[Former Member]

Dear All,=

I'm trying to find out the variance between the plan vs actual variance in the production order.

for plan value i did the following

1. kp26

2. kp06

3. KSPI

its updated the plan activity price perfectly.

for actual activity price calculation, i did the following

1. done Actual distribution from various GL to production cost centre with the cost element,

when I run S_ALR_87013611, its showing actual and plan overheads, but when i run KSBT actual value is not showing,

when i run KSII, its showing nil value for actual.

when i discuss with PP consultant, there is Activity qty and price at the time of production order confirmation, they are saying, confirmation will be done at the order level, so the plan value will be taken.

I dont know, whether i'm doing correct or not

kindly give me proper steps for actual activity price calculation

Thanks in advance

regards

elango

[Former Member]

thanks lot

[Former Member]

Hi Elango ,

Actual Cost of Labour are booked in FI and are transferred to CO to the labour Cost Center ..

Actual Activity Quantity are confimred in process orders . Process orders are debited with actual hours confirmed with plan rate ..

Now , at month end.. actual rate ( KSII) is computed , to find out the actual rate of the activity , as the process orders are debited with plan rate ..

The delta rate is then added to process order thru process order revaluation ( CON2 )..

For you case , check the following ..

1. Wether Actual Labour Cost is correctly booked in correct GL a/c , then flowing to correct Cost Center ..

2. Actual activity quantity are booked for the month thru process orders ..

If there is no actual activity quantity ( booked at process order level ).. you will not get any actual price

Regards

Sarada

[Former Member]

Hi Sarada,

Thanks for your inputs, i have some few doubts can anyone / you clarify the same

1. when you run KSII, (if the activity qty is entered in the production order) actual activity qty multiply with plan rate, which is updated through KSPI ...my understanding is correct or not?

2. or can i post the actual activity qty througn KB21N

3. the following difference is the variance (my understanding is correct or not)

Plan activity qty x plan rate

actual activity qty x plan rate

4. Plan rates are calculated as under (correct me if I'm wrong)

Plan overhead (entered in KP06) / plan activity qty (entered in KP26), when you run KSPI, the system will calculate this value and will be posted to the production cost centre.

waiting for your valuable reply

thanks in advance.

[Former Member]

Hi ,

Only your understanding in point No: 4 is absolutely correct ..

Now , actual activities are entered in the system either thru manual direct activity allocation ( KB21N ) or thru process order confirmation . The rate taken is the plan rate calculated thru KPSI ..

Variance is = ( Plan Rate - Actual Rate ) * Actual Qty ..

Actual Rate = Actual Cost in Cost Center /Actual Quantity .

KSII will allocate the delta to cost centers . For the process orders , the delta are transferred thru KSII ( Process Order Confirmations )

Regards

Sarada

[former_member440907]

Hi,

Suppose plan value in CC is 10 and plan activity is 1 hr your plan price is 10. In production order where planed activity is 1 hr. it will show a plan cost of 10. If 1.5 hrs is confirmed cost will be 1.5*10=15. There will be a variance of 5 in production order. At the same time if the actual cost posted to CC is 20 then there will be a credit of 15 due to confirmation and under absorption of 5.

When you do actual price calculation new price will be 20/1.5= 13.33. With this new rate order will be revalued and variance is cleared. At the same time CC also will get a credit of 20 and there won't be any under absorption.

Hope this is clear.

Regards

Ramesan.

[Former Member]

thanks its clear to me now