10 Replies Latest reply: Dec 15, 2010 3:15 AM by Radha Krishna Myneni RSS

Incorrect Calculation of Actual Overhead

moeed baig
Currently Being Moderated

I want that overhead should be calculated on basis of the following formula

 

(Material Cost x Rate + Labor Activity x Rate) = Overhead

 

However in SAP the system is calculating overhead on the basis of the following formula

 

(Labor Activity x Rate) = Overhead

 

The system is calculating correct overhead amount in target cost as origin group and overhead group are maintained in material master record but when I go for actual overhead calculation the overhead is calculated on labor activity only which is not correct.

 

Can any one suggest an appropriate solution for correct calculation of actual overheads.

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