What is distribution method in SAP FIN-BAC-INV - Inventory Accounting?

SAP Term: distribution method

• Component: FIN-BAC-INV

• Component Name: Inventory Accounting

• Description: Controls how costs are distributed. Examples of distribution methods in joint production: Equivalence number distribution Quantity-based distribution Quantity-based distribution with equivalence numbers

Smart SAP Assistant

• Key Concepts: 
  Distribution Method is a feature of SAP Inventory Accounting that allows users to assign a specific cost to each item in an inventory. This cost is then used to calculate the total cost of the inventory. The distribution method can be used to assign costs to items based on their quantity, value, or weight. 
  
  How to use it: 
  In order to use the Distribution Method feature, users must first set up the distribution method in the system. This can be done by going to the “Distribution Method” tab in the Inventory Accounting module. Once the distribution method has been set up, users can then assign costs to each item in their inventory. 
  
  Tips & Tricks: 
  When setting up the distribution method, it is important to consider how costs will be assigned to each item. For example, if items are being assigned costs based on their quantity, it is important to consider how much each item should cost and how many items are in the inventory. 
  
  Related Information: 
  The Distribution Method feature is closely related to other features of SAP Inventory Accounting such as Costing Methods and Cost Centers. It is important for users to understand how these features work together in order to effectively manage their inventory costs.