distribution and allocation

[Former Member]

Hi Gurus,

Please could you help me clarify the difference between distribution like top-down and Allocation as in cost allocation concepts?

Thanks

Markus Z.

[Former Member · Accepted solution]

Hi,

your go through this link http://help.sap.com/saphelp_47x200/helpdata/en/eb/13771c43c411d1896f0000e8322d00/frameset.htm

it is useful don't forget reward points

Regards

gvr

[Former Member]

The term allocation cannotes the allocation of cost [ overhead] to the different beneficiaries,namely,cost objects such as cost centers,orders etc.

The costs can be allocated using some basis such as " Area of the Room in allocating the Heating cost" etc.The basis used here is called "Tracing factor" in CO.

The main tool of Allocation are,Distribution,Assessment.Besides you have others as well.

The major diffrerence between Distribution and Assesment is;while Distribution is

used in case where the identity of the individual sender cost elements is a must.

Otherwise you use assesment.In both the cases cost elements are used.The assesment cost element is secondary.

[Former Member]

Thanks Gurus,

Are the concepts the same in the context of cost center ? The online help link showed that it was for profit center. Can I assume these concepts are the same and same meaning in both contexts?

Finally, can I say that both assessmt and allocation effectively does the same things but with conditions being slightly different, as stated by Ramesh?

In lay man terms, can I say that assessment and allocation is like dividing an overhead cost into respective components based on some factors?

regards

Markus Z.

[Former Member]

Hi Markus,

Please use the correct SAP terminology,lest you will land up in big confusion later on.

The assesment and distribution are the tools to allocate the overheads.You are right in your understanding.

Regards,

Ramesh.