To effectively plan production costs, you know that guesswork and projections aren’t enough. Optimize your production processes—and increase profitability—with this guide to production variance analysis in SAP S/4HANA. Start with the planning basics, and then perform costing runs and create cost estimates. See how to post actual costs with the Universal Journal, analyze variance during period-end processing, and assess scrap. Get details on SAP Fiori apps for reporting and the road ahead for variance analysis in this comprehensive resource!
In this book, you’ll learn about:
a. Product Costing
Compare planned versus actual costs in SAP S/4HANA. Walk through key product master data, and then create standard, preliminary, and mixed cost estimates. Post actual costs and analyze them using the Universal Journal and SAP Fiori apps.
b. Variance Calculation
Analyze variance at period-end close. Follow step-by-step instructions to configure and perform production variance analysis for the cost center, purchase price, and scrap. See how the Material Ledger and actual costing impact variance analysis.
c. Reporting
Explore your reporting options for production variance analysis in SAP S/4HANA: analysis reports, detailed reports, line item reports, production order reports, and cost center reports.
Highlights include:
1) Cost estimation
2) Actual postings
3) Product cost analysis
4) Period-end close
5) Variance configuration
6) Cost center variance
7) Purchase price variance
8) Scrap variance
9) Universal Journal
10) Material Ledger
11) Reporting
... Preface ... 13
... How This Book Is Organized ... 13
... Acknowledgments ... 15
1 ... Initial Planning ... 17
1.1 ... Sales and Operations Planning ... 18
1.2 ... Long-Term Planning ... 20
1.3 ... Cost Center Planning ... 29
1.4 ... Summary ... 35
2 ... Cost Estimates ... 37
2.1 ... Master Data ... 38
2.2 ... Overhead Costs ... 55
2.3 ... Cost Components ... 61
2.4 ... Costing Variant ... 64
2.5 ... Standard Cost Estimate ... 70
2.6 ... Costing Run ... 76
2.7 ... Preliminary Cost Estimate ... 87
2.8 ... Mixed Cost Estimate ... 93
2.9 ... Summary ... 98
3 ... Actual Costs ... 99
3.1 ... Primary Costs ... 99
3.2 ... Secondary Costs ... 103
3.3 ... Credits ... 105
3.4 ... Post Actual Costs ... 107
3.5 ... Report Actual Costs ... 112
3.6 ... Summary ... 118
4 ... Period-End Processing ... 119
4.1 ... Types of Variance Calculation ... 119
4.2 ... Variance Configuration ... 121
4.3 ... Variance Categories ... 130
4.4 ... Period End ... 135
4.5 ... Cost Center Variances ... 154
4.6 ... Purchase Price Variance ... 169
4.7 ... Actual Costing ... 175
4.8 ... Summary ... 178
5 ... Scrap Variance ... 179
5.1 ... Scrap Basics ... 179
5.2 ... Assembly Scrap ... 180
5.3 ... Component Scrap ... 189
5.4 ... Operation Scrap ... 196
5.5 ... Combined Scrap ... 205
5.6 ... Summary ... 211
6 ... Reporting ... 213
6.1 ... Margin Analysis ... 215
6.2 ... Summarized Analysis Reports ... 217
6.3 ... Detailed Reports ... 229
6.4 ... Line-Item Reports ... 231
6.5 ... Production Order Reports ... 234
6.6 ... Cost Center Reports ... 238
6.7 ... Summary ... 242
7 ... Future Direction of Variance Analysis ... 245
7.1 ... Event-Based Production Orders ... 246
7.2 ... Variance Categories ... 252
7.3 ... Production Variance in Margin Analysis ... 254
7.4 ... Summary ... 256
... Appendices ... 257
A ... Glossary ... 259
B ... Additional Resources ... 285
C ... The Authors ... 287
... Index ... 289
John Jordan is the founder and principal consultant at ERP Corp. Clients gain transparency of production costs, resulting in increased efficiency and profitability with John's expert assistance. He regularly speaks at conferences and publishes articles, provides training sessions for clients, and is the author of Production Variance Analysis in SAP (2nd ed., 2011) and Product Cost Controlling with SAP (2nd ed., 2012), both SAP PRESS bestsellers. John is considered one of the leading experts in the SAP ERP Controlling component by clients and peers.
Janet Salmon is the chief product owner for management accounting at SAP SE and has accompanied many developments to the controlling components of SAP ERP Financials as both a product and a solution manager. She regularly works with key customers and user groups in the United States and Germany to understand their controlling challenges and requirements. Her role is to design and implement innovative controlling solutions with SAP's development teams in Germany and China.
