Overhead Calculation in SAP CO
Overhead Calculation for Production Orders in SAP CO Using Overhead Keys
- What is an overhead key in SAP CO?
An overhead key in SAP CO enables different overhead rates to be applied to the same calculation base within a single costing sheet. By assigning the appropriate key to a controlling object, such as a production order, the system can calculate overhead costs using different rates without the need to create a separate costing sheet for each variant. This mechanism enables flexible allocation of overhead costs in line with the adopted controlling rules.
- Costing sheet configuration
The first step is to define a costing sheet by specifying the calculation base, overhead rates, and the method of posting the credit. In the example shown, a costing sheet was created in which three overhead variants were defined for the same calculation base, differing in percentage rate and assigned overhead key. This allows the system to apply the appropriate rate depending on the key assigned to the order.
Fig. 1. Costing sheet BLOG01 – definition of the calculation base, overhead, and credit.
Fig. 2. Definition of calculation base Y001 – cost element 51100000.
Fig. 3. Configuration of overhead C010 – assignment of percentage rates to overhead keys SAP (10%), SAP1 (12%), and SAP2 (14%).
Fig. 4. Definition of credit Y10 – cost element 94111000 and cost center 10101201 specified as the credited object.
- Determining the overhead key for a production order
When creating a production order, the relevant costing sheet and overhead key can be assigned manually on the “Control” tab. In the example shown, costing sheet BLOG01 and overhead key SAP1 were assigned to the order. A 12% overhead rate was defined for SAP1.
As a result, when overhead is calculated, the system applies the rate corresponding to the assigned key.
Fig. 5. Assignment of costing sheet BLOG01 and overhead key SAP1 to the production order.
The overhead key can also be determined based on the material master data. For this purpose, an overhead group is assigned in the material master and linked to the relevant overhead key in configuration. In the example below, overhead group ZACT00 was assigned to material FG29. For valuation area 1010, group ZACT00 was then linked to overhead key SAP1. This allows the overhead key to be determined automatically from the material master data and used in product costing as well as in the production order created for that material.
Fig. 6. Assignment of overhead group ZACT00 to overhead key SAP1 for valuation area 1010.
Fig. 7. Assignment of overhead group ZACT00 in the material master data for material FG29.
- Overhead calculation and result verification
After assigning the costing sheet and overhead key to the production order, direct costs of 1,000.00 were posted to cost element 51100000, which had previously been included in overhead calculation base Y001. The actual overhead calculation was then executed.
Fig. 8. Production order cost report before overhead calculation.
Based on the assigned SAP1 key, the system applied an overhead rate of 12%, calculating overhead costs of 120.00. This amount was posted to the production order under cost element 94111000, increasing the total actual costs of the order to 1,120.00.
Fig. 9. Production order cost report after overhead calculation.
The example demonstrates how assigning the appropriate overhead key makes it possible to apply different rates within a single costing sheet, without the need to create separate costing sheets for individual production orders.