What is valuation variant in SAP CO-PC - Product Cost Controlling?

SAP Term: valuation variant

• Component: CO-PC

• Component Name: Product Cost Controlling

• Description: A key, in Product Cost Planning, that determines the prices that the SAP System selects to valuate the quantity structure of a material cost estimate or order, or to valuate the costing items of a unit cost estimate. The valuation variant controls how the materials and activities in the cost estimate are valuated. The valuation variant specifies the following parameters: The price in the material master such as the standard price or in the purchasing info record such as the net order price that is used to cost a material in the BOM The planned or actual price that is used to valuate the internal activities The version in Cost Center Accounting that is used to valuate internal activities The costing sheet that is used to calculate overhead Whether, and to what extent, a BOM item or an operation in the routing is relevant to costing The different valuation strategies for materials, internal activities, external activities, and subcontracting are stored as strategy sequences.

Smart SAP Assistant

• Key Concepts: 
  Valuation variant is a feature in SAP Product Cost Controlling (CO-PC) that allows users to define the valuation of material and services used in production. It is used to determine the cost of goods manufactured (COGM) and the cost of goods sold (COGS). Valuation variants are used to define the valuation methods, such as standard price, moving average price, or FIFO. 
  
  How to use it: 
  Valuation variants are created in the SAP system and assigned to a material master record. The valuation variant is then used to calculate the cost of goods manufactured and sold. The valuation variant can be changed at any time, allowing users to adjust the cost of goods manufactured and sold accordingly. 
  
  Tips & Tricks: 
  When creating a valuation variant, it is important to consider the type of material being used and the production process. Different materials may require different valuation methods, so it is important to select the appropriate valuation variant for each material. Additionally, it is important to ensure that the valuation variant is updated regularly to reflect changes in production costs. 
  
  Related Information: 
  For more information on SAP Product Cost Controlling and valuation variants, please refer to the SAP Help Portal or contact your local SAP support team. Additionally, there are many online resources available that provide detailed information on SAP Product Cost Controlling and its features.