wat is the difference between standard price and moving average price?

[Former Member]

1 what is semi finished products?

2 .what is pipeline material?

3. what is back posting period?

4. what is fiscal year variant?

5. what is the difference between standard price and moving average price?

[Lakshmipathi]

Dear Mohammad

<b>Q1</b>

A group of raw material or parts that are assembled together and form either a semi finished product or a finished product. Example, if we take a water bottle, cap is a semi finished product and once it is assembled with the bottle, we can call it as a finished product. Of course, we can also consider cap as a finished product.

<b>Q2</b>

A pipeline material is a material that flows directly into the production process from a pipeline (for example, oil), from a pipe (for example, tap water), or from another similar source (for example, electricity).

A material from the pipeline is always available; i.e. it can be withdrawn from the pipeline at any time and in any quantity.

<b>Q3</b>

I think you are asking about manual posting. For example, to arrive at a sales value, the period will be closed in the succeeding month say 3rd or 4th During these grace period, sales can be posted to previous month during PGI.

<b>Q4</b>

The fiscal year variant contains the number of posting periods in the fiscal year and the number of special periods.

You can define a maximum of 16 posting periods for each fiscal year in the Controlling component (CO). To define the fiscal year variant, go to Customizing for Financial Accounting (FI), Financial Accounting Global Settings --> Fiscal Year --> Maintain Fiscal Year Variant

<b>Q5</b>

<b>1) Standard Average Price</b>

The valuation of material stocks at standard prices means that all goods movements are valuated at the same price over an extended period.

<b>Procedure</b>

Price variances (for example, purchase price higher than standard price) upon goods receipt or invoice receipt are posted by the system to price difference accounts. This does not affect the standard price.

<b>2) Moving Average Price</b>

The system calculates the moving average price automatically by dividing the material value in the stock account by the total of all storage location stocks in the plant concerned. It changes the price with each valuation-relevant movement.

The system changes the periodic unit price if you settle the material ledger and then save the data.

The valuation of stocks at moving average price or periodic unit price means that the price of the material is adapted to the continual fluctuations in the procurement price.

<b>Dependencies</b>

If the material ledger is activated for the material, the material's settlement control determines whether this price is the moving average price or the periodic unit price.

Thanks

G. Lakshmipathi

[Former Member]

Hi

The standard price/moving average price in material master is used to

valuation/determine the value of your inventory. The price on the purchase order is the base price that you actually pay for the inventory. The purchase order price should be pulled from the info record. These can sometimes be out of sync. If the material is valued at a standard price, the difference between the purchase order price and the standard price will go to a price difference account. If the material is valued at a moving average price, the difference between the purchase order price and the moving average price will NOT go to a price difference account. The moving average price will simply be adjusted.

We use a simple rule of any material purchased externally is valuated at a moving average price. Anything produced internally and placed into inventory is valuated at a standard price across all plants.