What is standard costs in SAP FS-BA-PM-AFP - Accounting for Financial Products?

SAP Term: standard costs

• Component: FS-BA-PM-AFP

• Component Name: Accounting for Financial Products

• Description: Indirect costs that are assigned to each financial product by means of installments and charges. Examples: standard process costs, standard risk costs, standard cost of capital

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• Key Concepts: 
  Standard costs are a type of cost accounting used in SAP FS-BA-PM-AFP Accounting for Financial Products. Standard costs are predetermined costs that are used to estimate the cost of producing a product or providing a service. They are based on historical data and are used to compare actual costs to the estimated costs. 
  
  How to use it: 
  Standard costs can be used to help manage and control the cost of production or services. They can be used to compare actual costs to the estimated costs, and can help identify areas where cost savings can be made. Standard costs can also be used to set budgets and track performance against those budgets. 
  
  Tips & Tricks: 
  When setting standard costs, it is important to ensure that they are realistic and achievable. It is also important to regularly review and update standard costs as market conditions change. 
  
  Related Information: 
  Standard costs are just one type of cost accounting used in SAP FS-BA-PM-AFP Accounting for Financial Products. Other types of cost accounting include actual costs, budgeted costs, and activity-based costing.