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traget costs calculation in repetitive manufacturing

Former Member
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Hi,

I am having the following scenario: target cost in version 0 in repetitive manufacturing for overhead costs is different from standard cost X delivered quantity.

For all the other items in product cost collector, target cost =standard cost X delivered quantity. Did anybody else have the same issue? Can you help me understand the logic in this? Or maybe I have incorrect customizing?

Lavinia

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Answers (2)

Answers (2)

Former Member
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Hi...

Refer to below sentence.

Costs in the standard cost estimate for the material that vary with the lot size are divided by the costing lot size and multiplied by the quantity delivered (the yield).

Former Member
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Thank you, Big Choi!

In my case, costing lot size is 1. I want to remember you, the difference is only for the overhead lines.

Lavinia

ArturoSenosain
Advisor
Advisor
0 Kudos

Hi Zara.

Target <> Actual is something normal, in general this is not an issue nor an error in customizing. There are some possible reason, but its impossible to know without see your system.

Just guessing:

1 Ask PP boys if they backflush the theorical qty of the activity or they post "actual" activity quantities in tcode MFBF.

2 Check the Target QTY and compare with the Actual QTY in KKBC_PKO They are the same or are different? If they are the same the differente in the target cost is because of a diffeente activity rate. Maybe you run MF30 Preliminary cost with a different activity rate or maybe. Other "maybe" is PP boys change the rate routing times.

If you post some screenshots of your system, someone here can give you a better opinion.

Arturo.

Former Member
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Hi Arturo, My issue is not at target vs actual, but at target vs standard cost. At first I noticed a difference between target cost debit and target cost credit. For me it makes no sense if I did not had a price change during the period. And when I compared standard cost x delivered quantity with target cost, I had a difference for the overhead lines.

Do you know if overhead in target is calculated somehow different?

Regards,

Lavinia

ArturoSenosain
Advisor
Advisor
0 Kudos

Ok.

Check your REM Profile. Here there are 2 options: Use Standard Cost or use MF30 Preliminary Cost Estimate

If you use Preliminary Cost Estimate, i guess your Target dont match to the Standard Cost Estimate CK11N.

Arturo.

ArturoSenosain
Advisor
Advisor
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Former Member
0 Kudos

Hi Arturo,

Thank you for answering. I checked everything you mentioned, I tested all possible cases, and I finally figured out what was going on: for overhead, in target cost calculation, the formula is not Value from standard cost*delivered quantity but it applies the calculation from costing sheet to the new calculated standard costs (example: target cost for activity confirmation is A (value from standard cost structure*delivered quantity)  and I have an overhead that calculates15% to activity confirmation=15%*A/100.

From this calculation comes out some rounding and when we are considering quantity like a few thousands on a month the value is relevant.

Do you know if there is another way of calculating target costs (I know about preliminary cost estimate, but is not suitable  for my client?

How can I possible change the current situation?

Best regards,

Lavinia