Defining Cost Centers
After completing this lesson, you will be able to create a cost center .
Cost Center Accounting
The cost center is master data in a CO area that represents a delimited location where costs occur.
You can use cost centers for differentiated assignment of overhead costs to organizational activities based on utilization of the relevant areas (cost determination function), and for differentiated controlling of costs arising in an organization (cost controlling function).
The CO-OM-CCA component tracks where costs occur in your organization. Cost centers can be defined according to several design approaches, such as functional requirements, allocation criteria, activities, and services provided geographic location or area of responsibility. The approach should be consistent throughout the enterprise. As a typical approach, an enterprise can define a cost center for each low-level organizational level that has responsibility for managing costs. As costs are incurred, they are assigned or posted to the appropriate cost center. These costs can include payroll costs, rent and utility costs, or any other costs relevant to a cost center.
The posting and assignment of costs to cost centers makes managerial accounting possible, which is a vital step for utilizing other CO components.
Cost Center Data
The Company Coded Segment represent the close ties between Management Accounting and FI. If a CO area has more than one company code, you must specify the company code that the user links to each cost center. If a segment reporting is required, you can derive the segment via a profit center, which you enter in the cost center master record.
The cost center master record is time dependent and assigned to a node of the standard cost center hierarchy. Additionally you assign the cost center to organizational units like company code and functional area.
The Control data is used to lock the cost center against planning and posting activities.
Statistical Key Figures
Statistical key figures are nonmonetary information that you can plan and post on cost centers (and other cost objects). They are used as additional reporting info in cost center reports, to calculate additional key figures, such as average salaries per employee, and as distribution factors to distribute cost from one cost center to another. An example could be the distribution of cost of a facility cost center to other cost centers according to the space in square meters (or square foot) that they use.
To allow the system to calculate the total, you need to determine the category value, as follows:
Fixed: the periodic values can not be added to a total. The system will calculate the total of a period as an average of the single values.
Total: the periodic values can be added to a total.
Create and Display Cost Centers
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How to assign Cost Centers to Profit Center in SAP
In this tutorial, we will learn Cost Centers to Profit Center in SAP
Steps to Assign Cost Centers to Profit Center
Step 1) Enter Transaction Code SPRO in the SAP Command Field
Step 2) In the next screen, Select ‘SAP Reference IMG’
Step 3) In the next screen , ‘Display IMG’ Follow the menu path Controlling->Profit Center Accounting -> Assignments of Account Assignment Objects to Profit Center ->Assign Cost Centers
Step 4) In the next screen, Enter the cost center to be assigned to a profit center
Step 5) In the next screen , Enter the profit center to which the cost center is assigned
Step 6) Press ‘Save’ button from the SAP Standard toolbar, for the saving the changes.
- How to create a new COST CENTER: SAP KS01
- Settlement of Internal Orders Tutorial: KO02 & KO88 in SAP
- SAP Profit Center Tutorial: Create, Group, Posting & Planning
- Creation Of Profit Center using Standard Hierarchy in SAP
- SAP CO Tables: Important Tables in Controlling Module
- Cost Center and Profit Center in SAP: What is the Difference?
- SAP CO (Controlling) Module Training Tutorial
- How to Create a New Cost Element
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You need to assign cost centers to profit centers so that you can reflect all the primary costs from Financial Accounting and all secondary allocations to profit centers in Cost Center Accounting. The assignment of a cost center also implicitly assigns all the assets that belong to that cost center to the profit center (see Assignment of Assets ...
Cost element. The activity type must be assigned to a secondary cost element so that the costs for this activity type can be included in costing under this cost element. This cost element must have cost element type 43 (internal activity allocation). The valuation date of the cost estimate must fall within the validity period of the cost element.
In this lesson, you will learn about the reason for using a cost center as an assignment object to collect overhead costs and get to know the role of a cost center hierarchy. ... In SAP S/4HANA, the organization chart is constructed through the cost center standard hierarchy.
(This is relationship A/B 011). No assignment percentage record can be entered. When you assign further cost centers (cost distribution), a record of infotype 1018 (cost distribution) is created for the organizational units and positions concerned. A cost center and a percentage record for the cost center assignment will be entered into this ...
The cost center is master data in a CO area that represents a delimited location where costs occur. You can use cost centers for differentiated assignment of overhead costs to organizational activities based on utilization of the relevant areas (cost determination function), and for differentiated controlling of costs arising in an organization (cost controlling function).
Assignment to Cost Center and Profit Center. * This product version is out of mainstream maintenance. The documentation is no longer regularly updated. To mark this page as a favorite, you need to log in with your SAP ID. If you do not have an SAP ID, you can create one for free from the login page. The following PDF options are available for ...
Basic Functions. Profit Center Assignments. Assignment of Cost Centers. Profit Center Accounting (EC-PCA) 6.0 EHP5 Latest. * This product version is out of mainstream maintenance. The documentation is no longer regularly updated. English. This document.
Step 2) In the next screen, Select 'SAP Reference IMG'. Step 3) In the next screen , 'Display IMG' Follow the menu path Controlling->Profit Center Accounting -> Assignments of Account Assignment Objects to Profit Center ->Assign Cost Centers. Step 4) In the next screen, Enter the cost center to be assigned to a profit center. Step 5) In ...
SAP ERP. Asset Accounting (FI-AA) Organizational Elements and Structures. Assignment to Organizational Units. Assignment to Cost Center and Profit Center. 6.0 EHP8 Latest. * This product version is out of mainstream maintenance. The documentation is no longer regularly updated. English.