How is scrap accounted in subcontracting?
The scrap or the process loss can be adjusted while doing a quality inspection of the material received after subcontracting.
Mail this postsubcontracting cycle.
When the material is sent for subcontracting i.e. some value addition, it is converted into a different material. It needs a BOM to define the components of the finished item being received.
Mail this postWhat are the steps involved in consignment cycle?
Consignment cycle is similar to a standard purchase cycle. The difference it that no accounting document is created at the time of goods receipts only QTY is updated.
It is settled once the same is utilized.
Mail this postWhat is meant by consignment stock?
Consignment stock is the material which is lying in the premises but is not owned by the company. It has no value assigned to it until it is taken into own stock. Once it is used in production or to be sold, it is taken into own stock.
Mail this postWhat is the difference between business area and profit center?
Business area is where the total business is valuated as a whole
Whereas Profit centre is an area where the company/work place allows the outside agency to use its machinery for external profits (eq: A CNC machine which can run 24 hrs a day is utilized in our company for 15 hrs and the balance 9 hrs is let out for addition to the company’s profit) is known as Profit Centre.
Business area is related term to FI module and Profit centre is related to CO module. One business area can have one or more profit centers.
Business area is gared on external accounting where as profit centers are used for internal accounting purposes
Mail this postWhat is difference between business area or cost centre?
Business area is a place where the product or the produced components are valued in group or for the total transactions carried out, Right from procurement, production and sales of goods.
Wheras Cost centre is a particular area where the production or the project is taken up and expenditure is identified separately with a separate GL account
Mail this postHow to integrate MM With Fico?
1. By using transaction code OBYC we can get the details of MM, Fico integration.
2. Go to IMG settings in Financial accounting and do the configuration for MM-FI settings
3. Value from MM to FI is defined in OBYC…. on the material master the flow of values are assigned on the Costing, Accounting, etc tabs where the system helps to post the necessary stock values into the appropriate GL accounts. Helps to determine, the GL accounts updated when there is a movement of goods.
Mail this postWhat is the difference between profit center accounting and Profitability analysis ?
Profit center accounting is basicaly done for internal controlling purposes. It lets you determine the profit and loss using the cost of sale approach or period accounting approach. Here you can find the profit from an “area of reponsibility or pserson” point of view.this is accound based costing
Whereas in Profitability analysis, market segments based on product , cutomer,order aor any comobination of these are studied to find wots the profit. PA provides information to the marketing,sales and planning department so that they can make decisions. PA has two forms account based and CO based.
Both these are tools for profit management, and both are alternative. They are not same.
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