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ERPCorp SAP FICO Blog
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By Tom King
SAP activity type category 3 combines manual quantity entry with indirect activity allocation. You record the sender's actual activity with KB51N, then run KSC5 to distribute that quantity using the cycle's sender/receiver relationships and tracing factors.
This worked example allocates 8,500 units of CATEG3 from cost center SND3 to three receiver cost centers. It shows how weighted receiver machine hours determine each receiver's share while the total sender quantity remains the amount manually posted.
Read more: SAP Category 3 Activity Types: Manual Entry, Indirect Allocation
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By Tom King
SAP category 2 activity types can calculate sender quantities from activity already posted in receiver cost centers. In this example, machine hours drive the quantity of support activity allocated from cost center SND2, using indirect activity allocation rather than a separate manual sender posting.
Learn how to plan the relationship, configure receiver tracing factors and weighting factors, execute the cycle with KSC5, and revalue the allocation at an actual activity rate.
Read more: SAP Category 2 Activity Allocation Using Receiver Activity
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By Tom King
Category 2 activity types are for indirect determination and indirect allocation.
Read more: SAP Activity Postings 2: Category 2 Activity Types
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By Tom King
Let's start with activity type category 1 (manual entry, manual allocation) which is the most common. Activity types defined with this category post directly from a cost center to a receiver cost object.
Look at the definition of activity type CATEG1 as shown at the top in Figure 1. In this case, Actl Acty Type Cat. (Actual Activity Type Category) is blank, which means it is the same as the plan activity type category, or 1 in this example.
2026 editorial note: This tutorial preserves Tom King’s original 2017 example and classic SAP GUI screenshots. Transaction and reporting availability depends on your SAP edition, release, and configuration. For SAP S/4HANA Cloud Public Edition, use the supported apps and processes for your activated scope.
Read more: SAP Category 1 Activity Allocation: KB21N Example
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By Paul Ovigele
SAP Material Ledger helps you understand inventory values and material cost differences. Its optional Actual Costing functionality calculates period-end material costs while retaining standard cost as a benchmark during the period.
This introduction explains how standard price, moving average price, and Actual Costing fit together. For SAP S/4HANA: Material Ledger is mandatory for inventory valuation; Actual Costing remains optional. ERPCorp has updated Paul’s original introduction to clarify these distinctions.
Read more: SAP Material Ledger Basics: Standard vs. Actual Costs
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By Tanya Duncan
SAP settlement rules, settlement profiles, and allocation structures work together to transfer costs from a sender, such as an order or WBS element, to the appropriate receivers. The profile defines the permitted framework, the rule specifies the receivers and distribution, and the allocation structure controls how source costs are represented during settlement.
These concepts apply to project settlement and to other SAP cost objects, including production orders, process orders, and real internal orders. The exact cost flow depends on the sender, receiver, and accounting scenario.
Read more: SAP Settlement Rules, Profiles, and Allocation Structures
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By Tanya Duncan
SAP determines the standard cost of a manufactured product from its component quantities, production activities, and overhead. During production, SAP records actual consumption on the production order and credits the order when finished goods are received into inventory.
This guide follows a typical make-to-stock production order, from the material cost estimate through goods movements, work in process (WIP), variance calculation, and settlement.
Read more: How SAP Determines Product Costs and Settles Production Orders
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By Tanya Duncan
Purchasing info records (PIRs) in SAP provide purchasing prices and conditions that can be used to value externally procured materials during product costing.
In SAP S/4HANA, costing variants and valuation variants determine how material prices are selected when calculating standard cost estimates. By configuring the valuation strategy to use purchasing info records, organizations can incorporate supplier prices and relevant purchasing conditions into material cost estimates.
This approach helps teams explain purchased material costs by separating relevant supplier price conditions, freight, and intercompany markups into appropriate cost components.
In this article, we explain how to configure SAP costing variants and valuation variants to use purchasing info record prices, assign purchasing conditions to cost components, and verify the results in a material cost estimate.
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By Janet Salmon
SAP Simple Finance 1503 introduced significant changes to financial accounting and controlling, including the Universal Journal, integration of G/L accounts and cost elements, and enhanced profitability reporting.
In this article, Janet Salmon answers frequently asked questions from a 2015 SAP Simple Finance webinar, covering CO-PA, document splitting, reporting, planning, and extensibility.
2026 Update: SAP Simple Finance 1503 was an early milestone in the evolution of SAP S/4HANA Finance. The original questions and answers are preserved below as 2015 answers. The 2026 updates are ERPCorp editorial notes and should not be read as new statements by Janet Salmon. This is a historical reference, not an implementation guide for a current SAP S/4HANA release. Current SAP S/4HANA releases include additional functionality, particularly in Margin Analysis, Universal Journal reporting, and financial planning.
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Hybrid planning lets finance teams use SAP Analytics Cloud (SAC) for planning while keeping selected models or processes in SAP Business Planning and Consolidation (BPC). The design depends on which BPC configuration you run and where you want approved plan data to reside.
This guide compares BPC Standard import and return, BPC Embedded live planning, and direct financial plan integration with SAP S/4HANA. Each route handles data entry, storage, and write-back differently.
Read more: Hybrid Planning with SAP BPC and SAP Analytics Cloud