What is 'recognized margin' in SAP CO-PC - Product Cost Controlling?

recognized margin - Overview

• Component: CO-PC

• Component Name: Product Cost Controlling

• Description: The difference between the recognized revenue and the recognized cost. 

recognized margin - Details

• 
  Key Concepts: 
  Recognized margin is a term used in SAP's CO-PC Product Cost Controlling component. It is the difference between the total cost of a product and its selling price. This difference is also known as the gross margin. It is used to measure the profitability of a product and to determine if it is being sold at a price that will generate a profit. 
  
  How to use it: 
  Recognized margin can be used to compare the profitability of different products or services. It can also be used to determine if a product or service is being sold at a price that will generate a profit. To calculate recognized margin, subtract the total cost of the product or service from its selling price. 
  
  Tips & Tricks: 
  When calculating recognized margin, it is important to include all costs associated with producing and selling the product or service, such as labor, materials, overhead, and marketing costs. Additionally, it is important to consider any discounts or other incentives that may be offered when calculating the selling price. 
  
  Related Information: 
  Recognized margin is closely related to another term, contribution margin. Contribution margin is the difference between the selling price and variable costs associated with producing and selling the product or service. Variable costs are those that vary depending on production levels, such as labor and materials costs.