Difference between COPC planning and cost object controlling

[Former Member]

I want to know why do we have to calculate the cost of a manufactured product by both COPC planning and Cost object controlling by order?

Will the cost of a manufactured product be different in COPC planning method and cost object controlling method?

if we use only cost object controlling to calculaute the cost of a manufactured product without using COPC planning wht will be the implications?

[Former Member]

Raja,

Yes the cost can be different. The cost calculating thorught Product Cost Planning may be static, you calculate it by period it is more for planning prupose ans to set standard. The cost calculated through Cost Object Controlling is resulting from your actual transactions, and the are few variables that could increase or decrease the cost of product. For example the overhead cost (Increase of salaries) can directly affect your activity rate at the work center and impact cost of your product when the production order is complete. You need both costs (Cost Planning and Cost Object releated) so at the end of the period you can calculate variance betweeen your plan cost and your actual costs.

Hope this clarifies your doubts.

GG