co products---equivalence number

[Former Member]

Hi all,

In case of co products we need to define the apportionate structure with equivalence number for costing purpose, this will be done in "Joint Production" details in the same view. Say for ex---30:30:20:20

What does these figures indicate???

What is the role of these figs in costing???

what is to be done in case of the BOM??

Regards,

MHP

[former_member196398 · Accepted solution]

MHP,

It simple, the equivalence number forms the basis for Cost Split among the Co-Products. Example the order cost is settled in the ratio of 30:30:20:20 to the co-products.

No other defination is required in the BOM with respect to equivalence number... In BOM Co-Product indicator should be activated and the quanities should be mentioned in -ve for the co-products.

Regards,

Prasobh

[Former Member · Accepted solution]

Hi Prasobh,

At first thanks for the reply. I have alocated the points for the same.

I want still some clarification.

1) Exactly which order costs are splitted??? Is it all or the selectively as defined in the joint production in mtl master by the source structure?????

2) Now if 30:30:20:20 these are the figures maintained for products say for ex A:B:C:D then, which is the main product & which is the coproduct??? In my opinion these figures can not reveal this. This will only be revealed through the BOM. Is it true??? If not then please correct me.

3)Is there any table from where i can directly get this type of structure for a particular plant???

I will be really thankful if u can spare ur valuable time for replying to this.

Thanks in advance.

Regards,

Manish Phatak

[Former Member · Accepted solution]

Dear,

It is as below

As per the apportion memnt structurte ypu define the

When you create a process order or a production order, the system

generates an order item for each co-product. The actual costs for goods

issues, confirmed internal activities, etc., are collected on the order

header. Goods receipts for the co-products are entered with reference to

the order item.

At the end of the period, the actual costs incurred for the order are

distributed to the co-products as equivalence numbers or as percentages.

Any discrepancies between the distributed actual costs and the debit

postings for the goods issues are settled to stock.

For each co-product, the apportionment structure indicates

o what equivalence numbers or percentages are used to distribute the

costs to the order items.

o the validity period of the equivalence number or the percentage

The apportionment structure can contain an origin structure. The origin

structure breaks down the actual costs according to origin assignment.

You can define what equivalence numbers are used for each origin

assignment. This enables you to distribute the material costs and

internal activities to the co-products according to different

equivalences, hence you can distribute the cost as per the origine- matyerial or activity and Equivalance number may be different in each origine cases

The system uses the apportionment structure (and possibly the origin

structure) to generate a settlement rule that distributes the costs

collected on the order header to the order items (co-products). For each

co-product, the system generates a further settlement rule that assigns

the costs distributed to the order item to stock.

Define an apportionment structure for each primary product and process

material. The same co-product can appear in more than one master recipe

or bill of material. The material in the order header determines what

apportionment structure is for distribution.

Pl come back if required

[former_member196398 · Accepted solution]

Manish,

1. When an order is created for Co-product header material, that particular order costs gets settled among the co-products based on the equivalence number defined in the Joint Production section of the material master of the Header/order material.

2. BOM does not reveal anything on how the costs needs to be settled. If you have maintained 30:30:20:20 (A:B:C:D) in the Joint production tab of the material master for "A" and if order is created for "A", the order costs are settled A=30%:B=30%:C=20%:D=20%.

3. Not sure of which structure you are asking for...Pls explain.

Regards,

Prasobh

[Former Member]

this will indicate that how much cost shearing has to be done between main product and co product

Equivalence Numbers

The activity types created on the cost center can be weighted by

assigning equivalence numbers to them. The costs not dependent on the

activity types are then allocated to the activity types in the cost

center based on this weighting.

The SAP System executes this allocation internally using two procedures

which require the calculated data to determine the activity-independent

values. Equivalence numbers are used in the transactions for

o activity price calculation

o variance calculation and allocation