What is preliminary order cost estimate in SAP CO-PC - Product Cost Controlling?

SAP Term: preliminary order cost estimate

• Component: CO-PC

• Component Name: Product Cost Controlling

• Description: A cost estimate for an order based on the quantity structure of the order. Preliminary order cost estimates can be used to calculate planning variances and production variances.

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• Key Concepts: 
  Preliminary order cost estimate is a feature of SAP's CO-PC Product Cost Controlling component. It is used to calculate the estimated cost of a production order before it is released. The cost estimate is based on the planned quantity, material, and overhead costs associated with the production order. 
  
  How to use it: 
  To use the preliminary order cost estimate feature, first enter the planned quantity and material costs associated with the production order. Then, enter the overhead costs associated with the production order. Finally, click “Calculate” to generate an estimated cost for the production order. 
  
  Tips & Tricks: 
  It is important to ensure that all planned costs are accurately entered into the system before calculating the estimated cost of a production order. This will ensure that the estimated cost is as accurate as possible. 
  
  Related Information: 
  The preliminary order cost estimate feature can be used in conjunction with other features of SAP's CO-PC Product Cost Controlling component, such as activity-based costing and product costing. This allows users to gain a more comprehensive understanding of their production costs.