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Sale of Externally procured Material (Trading Goods)

former_member222105
Active Participant
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Dear Experts,

Required advice on the treatment of raw materials which are procured from external vendor, and the sale of this material to the Customer.

Created the sales View for this product. But when Billing is done then the COPA error is getting populated as valuation with material cost estimate.

The error is due to missing of standard Cost, since costing key is trying to read cost component through valuation strategy.

Please provide the inputs on the same.Better way of handling the scenario.

Accepted Solutions (1)

Accepted Solutions (1)

ajaycwa1981
Active Contributor
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Hello

You might be using the config in KE4J or KEPC.

Don't assign a costing key to the Materisl type of Raw Materials. I assume you have a separate mat type for Raw Materials / Trading Materials

Ajay M

former_member222105
Active Participant
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Thanks Ajay,

This is a change in customizing settings. Yes there is separate material type, and can avoid the costing key assignment to the material type, if gets the approval for change.

Your reply is very helpful. But how these materials can be reported in KE30, since through SD condition type costs and revenue update the report but not the procurement cost.

ajaycwa1981
Active Contributor
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You need VPRS Cond Type in your Pricing procedure, which will flow the cost into COPA

Map VPRS to a Value Field in KE4I

former_member222105
Active Participant
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Yes, already mapped VPRS condition type to get COGS in COPA. What about the COGM? If we go for Cost estimate for the raw material(Trading Good) and Maintaining the Resale of material as a cost component in the cost component structure, and assigning this to value field, then  The COGM break will be updated as under the Resale material value field. Therefore the COGS and COGM break up exactly match with each other in COPA.

Seems better to carry out the standard cost estimate for the trading good. IF maintained moving average price for these materials, then getting procurement cost in COPA report is a challenge and finally the COGS value in COPA will update but will not have the procurement cost. Thus COGS not equals COGM.

Answers (1)

Answers (1)

Former Member
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Hi..

You select moving average price for Trading Goods rather than standard cost for trading goods.

You don’t setup valuation using material cost estimate for trading goods.

You maintain assignment of sd condition for cost to co-pa value field.

former_member222105
Active Participant
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Hello Choi,

Thanks for the reply. I did not valuate material cost estimate. I did maintain moving average price for the material. Also assigned SD condition types to COPA Value Fields.

Unfortunately system asking to valuate the material and update current standard price in valuation tab. System is rightly working, since for every sale the costing key reads valuation tab.

Here either i have to valuate the material using CK11N+CK24 or i have to create one more material as finished good then run standard cost.

What best we can do?

Former Member
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If you don’t want for system to get the standard cost from material master for material type “trading goods” when Billing is done,

You remove the material type “trading goods” like ‘HAWA’ from IMG : assign costing keys to material types.