SAP CO

The Cost Accounting (CO) module of SAP provides information to managers & decision makers to
understand where the companys money is !eing spent" #t not restricted !y any legal
re$uirements as in case of %# & is essentially an internal cost accounting tool"
Syllabus
SAP CO
Cost Center
&" Create Cost Center
'" Post to a Cost Center
Internal Order
(" All A!out internal Order
)" Settlement Of #nternal Orders To Cost Centers
Profit Center
*" Profit Center
+" Postings To Profit Center
," Profit Center Standard -ierarchy
." Assignment of Cost Centers To Profit Center
/" Assignment of 0aterials To Profit Center
Must Know!
&1" #mportant Ta!les in CO 0odule
11. Comparison 2etween Cost Center3 Profit Center and #nternal Order
SAP CO
Cost Center
How to Create a New Cost Center
To create a Cost Center3 4nter KS01 into SAP transaction code !o5"
#n the ne5t SAP screen
4nter the new cost center num!er"
4nter the validity dates of the new cost center"
Optional - #n the eferen!e section6
#n the Cost Center field3 you can enter a reference cost center if the details are similar to
the new cost center"
#n the Controllin" Area field3 you can enter the reference cost centers controlling area"
#n this tutorial3 we will create a cost center without a reference" Click 0aster 7ata 2utton
#n the Na#es section6
#n the Na#e field3 enter the name of the new cost center"
#n the $es!ription field3 enter a description for the new cost center"
#n the %asi! $ata section6
4nter the Person esponsible"
#n the %asi! $ata section6
4nter the Person esponsible
Select & 'Ad#inistration( for Cost Center Cate"ory"
Select the Hierar!)y area"
4nter the Co#pany Code"
The Curren!y will default !ased on the earlier selections"
On the Control ta! select the appropriate indicators"
Click Save" 8ew Cost Center is created"

&)y a Cost Center is re*uired+ #t is the location where the costs are incurred" #t can !e setup
!ased on areas of responsi!ility3 functional re$uirements3 allocation criteria3 geographical
locations or activities or services provided" #ts purposes is to provide cost related information in
Overhead Cost Accounting for which cost centers are grouped into units of decision making3
control and responsi!ility" To map this structure3 Cost center is placed in cost center standard
hierarchy"
How ,o Create Cost Center -roups 4nter Transaction Code 9S-& in the SAP Command %ield
#n the ne5t screen3 enter the Cost Center :roup #7 to !e created
#n the ne5t screen3 enter the Cost Center :roup 7escription
Press Save !utton in the SAP Standard Tool!ar for the Creation of the Cost Center :roup
Other 8oteworthy SAP transactions;
KS0. to C)an"e Cost Center
KS0/ to $isplay Cost Center
KS00 to $elete Cost Center
How to Post ,o Cost Center
4nter Transaction Code %2*1 in the SAP Command %ield #n the ne5t screen 3 4nter the %ollowing
&" 4nter the 7ocument date
'" 4nter the Company code
(" 4nter :<= Account for the 7e!it 4ntry which is to !e posted to the Cost Center
)" 4nter 7e!it Amount
*" 4nter the Cost Center in which the Amount is to !e posted
+" 4nter :<= Account for Credit 4ntry
," 4nter Credit Amount
Press Save 2utton for the SAP Standard Tool!ar to post the 7ocument
Check the Status !ar for the 7ocument 8um!er of the Successful 4ntry"

All about Internal Order in SAP
&)y Internal Order is re*uired+
#nternal orders descri!e individual >o!s within a controlling area" Orders support action;oriented
planning3 monitoring3 and allocation of costs" ?ou can use internal orders to6
&" 0onitor internal >o!s settled to cost centers (overhead orders)
'" 0onitor internal >o!s settled to fi5ed assets (investment orders)
(" Offsetting postings of accrued costs calculated in CO (accrual orders)
)" 7isplay the cost controlling parts of Sales and 7istri!ution customer not affect the core
!usiness of the company (orders with revenues)
@e can use overhead orders for detailed controlling for a particular o!>ect or activity" All costs
related to this o!>ect or activities are assigned to the relevant order" @e can use orders as
internal cost o!>ects"
%or e5ample if the company participates in ' trade fair to target new clients"
@ithout Orders3 we post costs for the two trade fairs directly to the cost center responsi!le for
supporting these events" As e5ternal costs and internal activities have the same cost elements on
the same cost center3 we cannot easily determine which event created which costs" This means
that we cannot make any further analyses for comparison purposes"
A further advantage is the wide variety of planning and !udgeting functions provided for orders"
As @ith Orders3 each event receives its own overhead order3 the costs are collected separately"
The settlement function allocates the order costs to the cost center responsi!le for supporting
the trade fairs3 which provides you with the organiAational view of the costs" This ena!les us to
analyAe and compare the results of the trade fairs3 even after the settlement has !een made"
Creatin" Internal Order
4nter Transaction code 9O1) (Order 0anager) in the SAP Command %ield
#n the ne5t screen3 Press Create !utton in the application tool!ar to create a new internal order
#n the ne5t dialog !o53 select the order type to !e created
#n the ne5t screen3 enter the following data
&" 4nter the Company Code
'" 4nter the 2usiness area
(" 4nter the O!>ect Class of the Order
)" 4nter the Profit Center
*" 4nter the Cost Center responsi!le for the internal order
Press Save !utton in the SAP standard tool!ar 3 to create the internal order
Check the status !ar for the newly created internal order num!er
Settle#ent of Internal Orders ,o Cost Centers
4nter Transaction Code 9O1' in the SAP Command %ield
#n the ne5t screen3 enter the #nternal Order for which settlement is to !e done
#n the ne5t screen3 Select the Settlement Bule 2utton from the Application Tool!ar
#n the ne5t screen3 enter the %ollowing
&" #n the Category Column enter CTB for cost center
'" #n the Settlement receiver Column enter the Cost Center in which the Order is to !e
settled
(" #n the percent column 3 4nter the percentage amount which is to !e settled
)" #n the settlement type 3 4nter P4B for periodic settlement"
Press Save !utton from the SAP Standard Tool!ar to save the Settlement Bule and come !ack to
the SAP 0ain menu"
4nter Transaction code 9O.. in SAP Command %ield
#n the ne5t screen3 4nter the %ollowing entries and run the settlement
&" 4nter the Order for which the settlement rule is maintained
'" 4nter the Period for settlement
(" 4nter the %iscal ?ear
)" Cncheck the Test Bun
*" Press 45ecute 2utton to run the settlement
All about Profit Center
&)y a Profit Center is re*uired
The Primary o!>ective of Profit Center is to represent an independent organiAational su!unit that
operates practically independently in the market3 !ears responsi!ility for its own costs and
revenue3 and can !e e5panded to !ecome an investment center or can !e treated as a Company
within a company" The Profit center approach em!odies the increasing re;esta!lishment
!etween internal and e5ternal accounting3 functioning as a connecting link !etween two
accounting concepts" Profit Center Accounting helps in answering the following $uestions6
&" -ow much is the revenueD
'" -ow much is the cost of goods manufacturedD
(" -ow much is the contri!ution marginD
)" -ow much is the administrative and sales costsD
*" -ow much is the operating profitD
BO#3 4EA and cash flow analyses are possi!le at profit center level"
Creation of Profit Center
4nter Transaction code 94*& in the SAP Command %ield
#n the ne5t screen3 4nter the controlling area in which the Profit Center is to !e created
#n the ne5t screen3 enter a uni$ue #d for the Profit Center
#n the ne5t screen3 enter the %ollowing
&" 4nter the name of the profit center
'" 4nter a short description of the profit center
(" 4nter the person responsi!le for the profit center
)" 4nter the profit center group for which the profit center !elongs to"
Press Save !utton3 for saving the profit center from the SAP Standard Tool!ar
The Profit is saved in the inactive mode
"
Press the Activation 2utton for the activation of the profit center from the Application Tool!ar
Check the Status !ar for the status of creation of profit center"
Profit Center -roup
4nter Transaction Code 9C-& in the SAP Command %ield
#n the ne5t screen 3 4nter the Controlling area in which the profit center group is to !e created
#n the ne5t screen3 4nter a uni$ue #d for the Profit center group to !e created
#n the ne5t screen3 enter a short description for the Profit center group
Press Save !utton 3 from the SAP Standard Tool!ar to create the profit center group
Check the Status !ar for the creation of the profit center group
Profit Center Plannin"
Planning Process is not a one;time activity3 !ut rather an iterative process3 which is usually
performed in several steps" Profit center planning is an integral part of your overall company
planning" The integral character of !usiness planning is particularly apparent within the conte5t
of Profit Center Accounting3 as the planning data used here is largely created in other
applications (such as Cost Center Accounting) and can !e supplemented or changed in Profit
Center Accounting" Profit center planning is part of short;term !usiness planning and thus
encompasses a span of one fiscal year" 7uring the profit center planning process3 #ndividual
planning areas are com!ined into an integrated planning network" @e can use various plan
versions in order to depict various planning Profit center planning offers us the following
methods of planning6
&" Copying e5isting plan or actual data to a plan
'" Posting plan data !y period or simultaneously !y transaction from other applications
(" 0anual planning of profit centers
)" 7istri!ution and Assessment of data !etween profit centers
*" Earious plan reports for comparison of different plan versions

How to do Postin" to Profit !enter in SAP
Postin" to Profit Center 1ia 2inan!ial $o!u#ent '2I Interfa!e(
4nter Transaction code %2*1 in the SAP Command %ield
#n the ne5t screen 3 4nter the following header data
&" 4nter 7ocument 7ate
'" 4nter Company code
4nter the %ollowing =ine #tem 7ata
&" 4nter 7e!it :<= Account
'" Select 7e!it
(" 4nter 7e!it Amount
)" 4nter Credit :<= Account
*" Select Credit
+" 4nter Credit Amount
After 4nter the =ine items3
&" Select the 7e!it =ine #tem
'" Press Choose 7etail !utton
#n the ne5t detail line item screen3 enter the Profit Center
Press Save !utton from SAP standard tool!ar to post the document
Check the status !ar for the 7ocument num!er for the confirmation of posting

Creation Of Profit Center usin" Standard Hierar!)y
Standard hierarchy is a tree structure for grouping all profit centers which !elong to a controlling
area" @hen creating a profit center3 you must assign it to a group (node) of the standard
hierarchy" This ensures that all profit center of a controlling area are grouped in one node" This
helps in reconciliation purposes" @e can maintain the standard hierarchy from the application
menu or in CustomiAing" CustomiAing also provides a function which allows you to create profit
center groups !y copying cost center groups" #f our cost center structure is similar to our profit
center structure3 we can use this function to copy the cost center standard hierarchy to create
our profit center standard hierarchy"
4nter Transaction Code 9C-& in SAP Command %ield
#n the ne5t screen3 enter the Controlling Area for which you want to create the Profit Center
Standard -ierarchy
#n the ne5t screen3 enter the main node Profit Center :roup of the Standard -ierarchy for the
Controlling Area to !e created
#n the ne5t screen3 4nter su! nodes or su! profit center groups of the Standard hierarchy
Similarly Assign profit center to the profit center groups
"
Save the structure3 and check the status !ar for the changes !e saved
A typical Standard -ierarchy display
How to assi"n Cost Centers to Profit Center
4nter Transaction Code SPBO in the SAP Command %ield
#n the ne5t screen3 select SAP Beference #0:

#n the ne5t screen 3 7isplay #0: %ollow the menu path Controlling;FProfit Center Accounting ;F
Assignments of Account Assignment O!>ects to Profit Center ;FAssign Cost Centers
#n the ne5t screen3 4nter the cost center to !e assigned to a profit center
#n the ne5t screen 3 4nter the profit center to which the cost center is assigned
Press Save !utton from the SAP Standard tool!ar 3 for the saving the changes"

How to assi"n #aterials to profit !enter in SAP
4nter Transaction Code SPBO in the SAP Command %ield
#n the ne5t screen3 select the SAP Beference #0: !utton
#n the ne5t screen 3 7#SP=A? #0: follow the menu path Controlling ;F Profit Center Accounting
;F Assignments of Account Assignment O!>ects to Profit Center ;F0aterial ;FAssign 0aterial
0asters
#n the ne5t screen3 enter the 0aterial #7 for which the profit center is to !e assigned
#n the ne5t dialog !o53 select Sales :eneral<Plant Eiew of the material master
#n the ne5t dialog !o53 enter the %ollowing
&" 4nter the Plant for the 0aterial
'" 4nter the Sales OrganiAation
(" 4nter the 7istri!ution channel
#n the ne5t screen3 enter the Profit Center in the 0aster
Press Save !utton from the SAP Standard Tool!ar to complete the assignment
3ist of i#portant tables in Controllin" Module 'CO ,ables(
CO ,ables4
O5er)ead Cost Controllin"
A&(' Price per Cost Center
A&(+ Price per Controlling Area
A&(, Price per Country < Begion
COSC CO O!>ects6 Assignment of Original Cost Sheets
CSS9 Cost Center < Cost 4lement
CSS= Cost Center < Activity Type
9APS CO Period =ocks

O5er)ead Cost Controllin"4
-eneral Ser5i!es
CS9A Cost 4lements
CS92 Cost 4lements
CS9S Cost Center 0aster 7ata
CS=A Activity 0aster
O5er)ead Cost Controllin"
CO29 CO O!>ect6 7ocument -eader
CO4G CO O!>ect6 =ine #tems
CO4G= CO O!>ect6 =ine #tems for Activity
CO4GB CO O!>ect6 =ine #tems for S9%
CO4GT CO O!>ect6 =ine #tems for Prices
CO4P CO O!>ect6 =ine #tems (!y Period)
CO4P= CO O!>ect6 =ine #tems for Activity
CO4PB CO O!>ect6 =ine #tems for S9%
CO4PT CO O!>ect6 =ine #tems for Prices
CO9A CO O!>ect6 Control 7ata for Cost
CO9= CO O!>ect6 Control 7ata for Activty
CO9P CO O!>ect6 Control 7ata for Primary Planning
CO9B CO O!>ect6 Control 7ata for Statistical key %igures
CO9S CO O!>ect6 Control 7ata for Secondary Planning
Cost 6le#ent A!!ountin" 'e!on!iliation 3ed"er(
CO%#1& O!>ect Ta!le for Beconciliation
CO%#1' Transaction 7ependent %ields
CO%#P Single Plan #tems for Beconciliation
CO%#S Actual =ine #tems for Beconciliation
Cost Center A!!ountin" 'Cost A!!ountin" Plannin" K-S(
A&(. Price per Company Code
A&(/ Price per Profit Center

O5er)ead Orders4
Appli!ation $e5elop#ent 7/ Cost A!!ountin" Settle#ent
ACAA Settlement 7ocument6 Beceiver Segment
ACA2 Settlement 7ocument6 7istri!ution Bules
ACA# Settlement Bules per 7epreciation Area
ACA9 7ocument -eader for Settlement
ACAO 7ocument Segment6 CO O!>ects to !e Settled
ACAE 7ocument Segment6 Transactions
CO2BA Settlement Bule for Order Settlement
CO2B2 7istri!ution Bules Settlement Bule Order Settlement

O5er)ead Orders4
Cost A!!ountin" Orders
AC%9 Order 0aster 7ata
AC%=A?1 4nttity Ta!le6 Order =ayouts
Profit Center A!!ountin"
C4PC Profit Center 0aster 7ata Ta!le
C4PCT Te5ts for Profit Center 0aster 7ata
C4PCH2C9BS Assignment of Profit Center to a Company Code
:=PCA 4C;PCA6 Actual =ine #tems :
=PCC 4C;PCA6 Transaction Attri!utes
:=PCO 4C;PCA6 O!>ect Ta!le for Account
:=PCP 4C;PCA6 Plan =ine #tems

PCA %asi! Settin"s4
Custo#i8in" for Profit Center A!!ountin"
A&)& 7ependent on 0aterial and Beceive profit center
A&)' 7ependent on 0aterial
A&)( 7ependent on 0aterial :roup
Co#pare Cost !enter9 Profit !enter and internal order
=etIs $uickly compare the three entities
Profit !enter4
&" Profit center is an organiAational unit in accounting that reflects a management;oriented
structure of the organiAation for the purpose of internal control"
'" Profit Center Accounting evaluates the profit or loss of individual3 independent areas
within an organiAation"
(" These areas are responsi!le for their costs and revenues"
Cost Center4
&" Cost Centers are the organiAational units within a controlling area that represents a
location where costs occur"
'" OrganiAational divisions can !e done on the !asis of functional3 settlement;related3
activity;related3 region<section<department related3 and<or responsi!ility;related3 to monitor
actual and plan figure standpoints
(" @here cost is captured"
Internal Order4
&" An internal order is used to accumulate cost for a specific pro>ect or task for a specific
time period"
'" An internal order is therefore used for a short period with a specific deadline"