What is net target cost in SAP CO-PC - Product Cost Controlling?

SAP Term: net target cost

• Component: CO-PC

• Component Name: Product Cost Controlling

• Description: The costs that are used to calculate variances in Product Cost by Period and Product Cost by Order. They are calculated as follows: In Product Cost by Period - Net target cost = Target cost - Work in process at target cost - Scrap variance In Product Cost by Order - Net target cost = Target cost - Scrap variance Net target costs can be calculated in all target cost versions that compare target costs to actual costs. In the standard system, these are target cost versions 0, 1, and 3.

Smart SAP Assistant

• Key Concepts: 
  Net target cost is a term used in SAP's CO-PC Product Cost Controlling component. It is the difference between the target cost and the actual cost of a product. The target cost is the estimated cost of producing a product, while the actual cost is the actual cost of producing the product. The net target cost is calculated by subtracting the actual cost from the target cost. 
  
  How to use it: 
  Net target cost can be used to measure how close a company is to achieving its target costs for a product. It can also be used to identify areas where costs can be reduced or improved in order to reach the desired target cost. 
  
  Tips & Tricks: 
  When calculating net target cost, it is important to consider all costs associated with producing a product, including labor, materials, overhead, and other costs. Additionally, it is important to consider any discounts or incentives that may affect the actual cost of producing a product. 
  
  Related Information: 
  Net target cost is related to other terms such as target costing, actual costing, and standard costing. Target costing is the process of estimating the costs associated with producing a product before production begins. Actual costing is the process of tracking and recording all costs associated with producing a product during production. Standard costing is the process of setting predetermined costs for each component of a product before production begins.