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How is activity dependent and activity independent cost determined in sap?


Asked by Chana Rubio on Nov 28, 2021 FAQ



In this way we can decide activity dependent and activity independent cost and in SAP it can be used to distribute the cost to the product. The details can be seen from the below document on how to differentiate activity dependent and activity independent cost:
In fact,
Activity Independent Planning : If you don’t enter an activity type, then the plan you enter on the following screen is independent of an activity and all cost are fixed. Activity Dependent Planning : If you enter Activity Type then the plan is associated with that activity. You can enter fixed and variable costs.
Keeping this in consideration, Activity independent costs are segregated among different activities based on Splitting Structure, while activity dependent cost directly used for the purpose of variable activity rate calculation. In product costing all those cost, which doesn’t vary based on the activities in manufacturing cost will represent fixed cost.
Moreover,
· Fixed Activity rates are calculated based on Plan Cost (Fixed) Split, during KSS4, divided by Capacity. · Variable Activity rate are calculated based on Variable Cost, assigned to activity at the time of Primary cost planning (KP06), divided by Capacity.
Additionally,
Activity based costing is primarily used to capture the costs of internal events, such as travel costs and trade fairs. False. ABC provides a business process view of overhead costs.