in the below screen we will configure two things. i.e.

the below screen is used for two things 1 For calculating the activity prices 2 For allocating the activity type quantity

You need to choose an activity "unit of measure" to measure the activity performed in terms of quantity by the cost center /cost object. you can assign up to 8 categories. If you enter say P&S here, then it means that this activity type can only be used against those cost centers where the category is declared as P/S. If you want to use this "activity type" for all cost center then put * in this field. This way you can restrict the use of the

Activity Type Category Indicator signifies the determination of how an activity type is being allocatedto cost objects.

Each cost center is designated to some work. This work is called activity is SAP terminology. The cost center that performs the activity/work to other cost centers/cost objecsts is called the sender, the cost center or other cost object that receives activities is known as the receiver. Activity types classifes the activities performed by the cost centers. The activity type classifies the activities that are to be performed by one or several cost centers. What is output of a cost center? the output of a cost center is measured in terms of activity type. Threfore, by defining the activity type we will try to measure the output of cost center.

input planning the input to a cost center is "cost element" or

Cost center

output planning the resulting output of a cost

In carrying out an activity i.e. to get the desired output the cost center consumes resources. Activity types provide a tracing factor (cost driver) for cost allocations, for example, labor time, machine hours, and so on.

activity type category-3 Activities which cannot be planned, or only at great expense, do not have to be planned manually (activity type category 3). The activity quantities are calculated automatically through indirect activity allocation (see: Indirect Activity Allocation).
For certain activity types you can determine the total activity quantity for each sender. These are category 3 activity types, Manual entry, indirect allocation.

Using indirect activity allocation, these posted activity quantities are distributed by the senders among the receivers defined in the segment according to their allocation bases. The corresponding segment must use the sender rule Posted quantities. Any receiver rule can be used, with the exception of Fixed quantities

The Quality control cost center uses 1000 hours of the Testing activity type. This cost center provides activity for the cost centers Goods receipt and Finished products . Allocations are made on the basis of the tracing factor Num of test item (TI). These are 4000 items for the Goods receipt cost center and 6000 items for Finished products . This corresponds to an activity input of 400 hours for Goods receipt and 600 hours for Finished products . ber s The price per activity unit for the Quality control cost center is 50 USD/hr. This results in activity output costs of 50,000 USD. The receiver cost centers are debited with the following costs based on the tracing factor TI. Goods receipt: (50,000 USD X 4000 TI) / 10,000 TI = 20,000 USD Finished products: (50,000 USD X 6.000 TI) / 10,000 TI = 30,000 USD

Activity Types Category 2 (Indirect entry, indirect allocation).

Activity quantities can be determined for each sender, but only with great difficulty

In this case, the R/3 System determines the activity quantity based: Either on receiver tracing factors with weighting factors, which can be defined for each sender If you use the sender rule Inversely determ ined quantities , you define the weighting factors described above by choosing Sender values . Or through Fixed quantity values, which you define in segment definition. If you use the sender rule Fixed quantities , you define the fixed activity quantity by choosing Sender values . These activity types belong to category 2 (Indirect entry, indirect allocation). The corresponding segment can use the following combinations of sender and receiver rules: Sender rule Inversely determ ine d quantity Fixed quantity Receiver rules Any

Any

In the example, you calculate activities for the sender using the receiver tracing factors with weighting factors, which are to be defined for the sender. The sender rules here are inversely determ ined quantities. You can use any receiver rule. The receiver tracing factors are: Goods receipt: 4000 test items Finished products: 6000 test items You need 0.4 hour to check one item using the Quality control cost center. The sender rule defines a weighting factor of 0.4 for the Test activity type. This results in an activity input of 1600 hours on the Goods receipt cost center and 2400 hours on Finished products . The Test activity is valuated with a price of 5 USD/hr. This results in a credit to the sender of 20,000 USD and debits of 8,000 USD to Goods receipt and 12,000 USD to the Finished products cost center.

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The rules for the allocation types are comprised of sender and receiver rules. These are illustrated in the graphic:

Sender Rules
Sender values for distribution, assessment and periodic reposting can be determined according to the following rules: 1. Posted amounts 2. Fixed amount 3. Fixed price

Sender values for indirect activity allocation can be determined according to the following rules:
1. Posted amount 2. Fixed amounts 3. Inversely determined quantities

Receiver Rules
You can use the following receiver rules for distribution, assessment, and periodic reposting: 1. Variable portions 2. Fixed amounts 3. Fixed percentages 4. Fixed portions

If, when defining the segment, you selected the receiver rule Variable portions , then those fields in which you must make entries in the following are marked as required entry fields. This helps prevent incorrect entries. You can use the following receiver tracing factors for indirect activity allocation: 1. Variable portions 2. Fixed amounts 3. Fixed percentages 4. Fixed portions

Receiver Tracing Factors

If you are using the receiver rule Variable portions , you can use the following receiver tracing factors: 1. Act. costs 2. Planned costs 3. Actual consumption 4. Plan consumption 5. Actual statistical key figures 6. Plan statistical key figures 7. Actual activity 8. Plan activity 9. Statistical actual costs 10. Statistical plan costs

If you are using variable portions as the receiver rule, together with, for example, the receiver tracing factors actual- or plan costs, this is described as flexible tracing factor determination. The tracing factor is determined by the system dynamically during the allocation, based on the posted amounts.

Combinations of Sender and Receiver Rules

The following sender and receiver relationships are possible for distribution, assessment and periodic reposting:

The following sender and receiver relationships are possible for indirect activity allocation:

Examples
1. Allocation by fixed amounts (on the receiver side)

The combination of fixed amounts on the receiver side with fixed amounts on the sender side is not advisable. In this case, the system always uses the fixed receiver amounts for the allocation. 2. Allocation by fixed percentages (on the receiver side)

The total of the percentage rates may not be greater than 100%. If the total percentage is less than 100%, a remainder amount remains on the sender. 3. Allocation by fixed portions (on the receiver side)

Sender cost center A allocates an overall amount of $100,000. Of this amount, 50 portions are allocated to receiver cost centers B and C, as well as 100 portions to cost center D. A total of 200 portions are allocated. The amount to be allocated for each cost center is calculated by dividing the overall amount to be allocated ($100,000) by the overall sum of the portions (200) and then multiplying this total by the shares for each receiver.

As a rule, the sender cost centers are automatically credited in full using this method, except when a percentage residual value is to remain on the senders. 4. Allocation by variable portions (on the receiver side) The receiver tracing factors are determined from the values on the totals databases. You specify the selection criteria for the receiver tracing factors on the Tracing factors screen. The following selection criteria can be used, depending on the receiver rule you have selected: - Version - Cost element