Automation of Standard Cost Estimate (CK40N)

Introduction:
Calculation of standard cost is the annual event generally done at the beginning of financial year during Planning & Budgeting activities, which result into calculation and release of standard cost estimate.
CK40N is a powerful tool provided by SAP to calculate cost estimate with high level of accuracy for in-house produced material and material procured from outside. CK40N is executed in multiple steps from selection of material to release of cost estimate, which generally took of time to get executed. The purpose of this article is to specify how we can use the standard functionality of SAP to automate CK40N, for calculating cost estimates.

Automation of CK40N:
Product cost estimate through CK40N includes the below steps:

• Selection
• Structure Explosion for in-house produced materials
• Costing for all the materials at structure explosion
• Analysis for cost estimates
• Marking for cost estimate as future standard cost
• Release of future cost estimate as current standard cost estimates

Define the costing run name:
Transaction CK40N, new cost estimate

Specify the validity dates for cost estimates 

Save the costing Run. Now we can see the different steps under Create Cost estimate tab. We need to change Parameter for each flow and by specifying parameters for all the steps then we will execute CK40N on background by considering all the steps in one go.  

Selection of material

After executing the selection step, system start selecting the materials to be used for the costing run, according to the selection criteria. Generally we specify the plants as selection criteria, if we don`t specify any plant or material then system consider all the plants under the co. Code level for which we are creating the costing run, so it`s necessary to specify the selection criteria based on requirement.  

Click on change parameter, 

     Specify: Plant

     Activate Background Processing

Click on Save

A message will appear as variant created, keep the note of the name. The same variant will be created in all other steps. 

Click on Back button or <F3> to go to initial screen of CK40N run

Structure Explosion for in-house produced materials

Structure explosion is the process of including the lower level materials i.e. the materials used under the bill of materials for in-house produced materials selected at previous steps. The main reason for this step is to do the cost estimate for raw materials in BOM so that cost estimate for in-house materials can be ascertained correctly.

Click on change parameter

     Activate Background Processing  

Click on Save

A message will appear as variant saved.

Costing for all the materials at structure explosion

Execution of costing step, allow the system to do the cost estimates for all the materials selected in structure explosion step. It includes the cost estimates for raw material, purchase from external vendor and calculate the cost of in-house produced materials from plan activity rates and raw material cost.  

Click on change parameter

     Activate Background Processing

Click on Save

A message will appear as variant saved.

Analysis for cost estimates

This step provide the analysis of cost estimates based with the details of different components like raw material cost, overhead cost, manufacturing cost etc for main and auxiliary cost estimate. The cost estimates details can be viewed at cost element level.

Click on change parameter

     Activate Background Processing

Click on Save

A message will appear as variant saved with the same variant name.

Marking for cost estimate as future standard cost

Execution of marking step indicates that cost estimates for material is recorded in material master data as Future Standard Cost. This can be viewed in field Future cost estimates under the tab Cost estimate 2 in material master data. Marking of cost estimates can be done in advance before the cost estimate valid dates come. 

Allow the marking to be executed

Click on change parameter

     Activate Background Processing

Click on Save

A message will appear as variant saved.

Release of future cost estimate as current standard cost estimates

After executing the release step, the mark future costs get converted to current standard cost estimates. This can be viewed in field Current standard cost estimates under the tab Cost estimate 2 in material master data

Click on change parameter

     Activate Background Processing

Click on Save

A message will appear as variant saved.

Click back button, now we can see the below screen .

Automation with the help of Background job runs:

We can execute all the steps of CK40N through background job run in a proper sequence so that all the steps will come at the right sequence and then cost estimate can be released automatically.

SAP use the different Program name for executing the different steps, as specified in below tables.

Variant	Description of Step	Program Name
MANISHKR735372	Selection	SAPRCK60
MANISHKR735372	Structure Explosion	SAPRCK62
MANISHKR735372	Costing	SAPRCK10
MANISHKR735372	Analysis	RKKBCAL2
MANISHKR735372	Marking	SAPRCK23
MANISHKR735372	Release	SAPRCK23

Now execute the steps through Background processing:

Transaction SM36

Click on Job Wizard

Specify the Job Name:

Select ABAP program step

Click Continue

Now we will define the first step (Selection step in CK40N)

Specify the program name for selection step as SAPRCK60 & name of variant as noted at the time of saving the selection step. The name of variant will be same for all the steps but the name of program will change.

Click Add additional steps and then we will continue to define the steps for other steps of CK40N

Details for Structure explosion step: 

Details for Costing step: 

Details for Analysis step: 

Details for Marking step: 

Details for Release step: 

Click on time to start the job, it can be immediately or we can specify date & time.

Click on Continue & then save the jobs.

Once the jobs gets finished, we can check CK40N for the results

If there will no errors in costing then all the steps will be get executed.

Important points:

Must open all the steps and save on background processing, so that variant can generated and saved for all steps.

Allow the authorization for marking.

Remove the test runs from step Marking & Release

Source: scn.sap.com