- SAP Managed Tags
In this Blog Am going to share about functionality of SAP Product Costing & Project Systems - ETO-Scenario - Results Analysis – Revenue Based Method with Profit Realization core configuration and Earned Value calculation Results.
1. Illustration introduction
2. User Activities
3. Report
My previous blog about RA: POC method using Progress Version
https://community.sap.com/t5/product-lifecycle-management-blog-posts-by-members/copc-eto-scenario-re...
Before going ahead, would like show you the Project Structure Progress Results Analysis ReportCJ20N & WBS Hierarchy
WBS Hierarchy flow:
ETO-Scenario - Results Analysis: (01) Revenue Based Method with Profit Realization
Use
You can use the revenue-based method with profit realization for:
Sales orders
Projects
Internal orders with revenue, service orders with revenue, maintenance orders with revenue
Revenue-based results analysis allows you to:
Create reserves for unrealized costs
Create reserves for imminent losses
Use milestone billing
Show interim profits
Profit realization is understood to mean showing interim profits. Interim profits arise when the revenue in a period is greater than the cost of sales and the difference is shown as a profit even though further revenues and costs are expected.
Illustration:
You have planned revenues of EUR 200,000 and costs of EUR 120,000 for your sales order.
Period 04
In period 04 you have actual costs of EUR 20,000 but no revenues. In results analysis, the system calculates the following data:
Capitalized costs in the amount of the actual costs (EUR 20,000)
Revenue of EUR 0
Cost of sales of EUR 0
This step valuates the WBS element according to the setting of Results AnalysisT-Code: KKA2
Earned Value Analysis:
Period: 05
In period 05 the actual costs increase by EUR 60,000 and now total EUR 80,000. You deliver to your customer and send him a milestone invoice for EUR 100,000. The order is partially delivered and partially billed. In results analysis, the system calculates the following data:
- Cost of sales of EUR 60,000
- Costs Capitalized costs of EUR 20,000
- Revenue affecting net income of EUR 100,000
T-Code: KKA2
Earned Value Analysis
- Progress Analysis Report
- Period 6
In period 06 the actual costs increase to EUR 90,000. You deliver a second amount to your customer and send him a second milestone billing for EUR 90,000. The total revenue is now EUR 190,000. The order is partially delivered and partially billed.
In results analysis, the system calculates the following data:
- Cost of sales of EUR 114,000
- Reserves for unrealized costs of EUR 24,000
The system cancels the capitalized costs of EUR 20,000. The system creates reserves for unrealized costs in the amount of EUR 24,000.
Revenue affecting net income of EUR 190,000
T-Code: KKA2
Earned Value Report
Progress Analysis Report
7th PeriodIn period 07 the actual costs increase to EUR 130,000. You deliver the remaining goods and send the customer the final invoice for EUR 10,000. The order is now fully delivered and fully invoiced.
In results analysis, the system calculates the following:
Since the actual costs exceed the planned costs, the system sets the cost of sales to the value of the actual costs.
- No reserves for unrealized costs. The existing reserves are canceled.
- Revenue affecting net income of EUR 200,000
T-Code : KKA2 - Earned Value Report
- Progress Analysis Report
Conclusion:
My previous blog about RA: POC method using Progress Version
https://community.sap.com/t5/product-lifecycle-management-blog-posts-by-members/copc-eto-scenario-re...
Your comments are welcomed to improvise this blog 🙏.
