COGM & COGS in Product Costing

COGM = Cost of Goods Manufactured

COGS = Cost of Goods Sold

To calculate the COGM and COGS for materials, you can execute a material cost estimate (with or without quantity structure)

To calculate the COGM and COGS for products that do not have any master data (such as services or materials at the planning stage), you can avail yourself of the Reference and Simulation Costing functions

COSTING SEQUENCE

You can create different types of cost estimates at different stages of the product planning and production cycle.

• If you are planning a new product for which only some of the master data (such as the material master) has been created in the system, you can use a material cost estimate without quantity structure to manually plan the cost of goods manufactured and cost of goods sold.
• When the complete master data including BOMs and routings is available in the system, you can create a material cost estimate with quantity structure. This cost estimate automatically calculates the cost of goods manufactured and cost of goods sold.

Type of Cost Estimate	Purpose
Standard cost estimate	Valuation of the planned quantity structure with planned pricesCalculation of standard prices for the valuation of materials with price control S
Modified standard cost estimate	Valuation of current quantities with planned pricesCosting of materials during the fiscal year in order to analyze changes in costs
Current cost estimate	Valuation of current quantities with current pricesCosting of materials during the fiscal year in order to analyze changes in costs
Inventory cost estimate	Valuation of current quantities with tax-based and commercial pricesEstablishment of valuation approaches for inventory valuation