setting up Sales Order Costing in SAP requires both Controlling (CO-PC, CO-PA) and SD integration. Below, I’ll list the SPRO Nodes / T-codes you need to configure so that Sales Order Costing (Product Cost by Sales Order) works smoothly.

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🔹 Configuration Steps for Sales Order Costing

1. Activate Product Cost by Sales Order

• SPRO Path:
  Controlling → Product Cost Controlling → Product Cost by Sales Order → Basic Settings → Activate Costing for Sales Orders
• T-code:OKG8
  • Define which item categories in SD require sales order costing (e.g., MTO items).

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2. Assign Requirements Class to Item Categories

• SPRO Path:
  Sales and Distribution → Basic Functions → Availability Check and Transfer of Requirements → Transfer of Requirements → Define Requirements Classes
• T-code:OVZG
  • Ensure the requirement class has “Costing Relevant” checked.
  • Assign costing variant for sales order (usually PPC1/PPC2).

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3. Define Costing Variants for Sales Orders

• SPRO Path:
  Controlling → Product Cost Controlling → Product Cost by Sales Order → Cost Object Controlling → Define Costing Variants for Sales Orders
• T-code:OKKN
  • Define/Check costing variant PPC1 (planned), PPC2 (actual).
  • Assign valuation variants and overhead keys.

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4. Valuation Variants

• SPRO Path:
  Controlling → Product Cost Controlling → Cost Object Controlling → Define Valuation Variants
• T-code:OKK4
  • Controls how materials, activities, and external services are valued in costing.

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5. Overhead Costing Sheet

• SPRO Path:
  Controlling → Product Cost Controlling → Overhead → Define Costing Sheet
• T-code:KZS2 / KZS3
  • Define overhead application rules (material overhead, production overhead).

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6. Settlement Profile

• SPRO Path:
  Controlling → Product Cost Controlling → Product Cost by Sales Order → Period-End Closing → Define Settlement Profile
• T-code:OKO7
  • Controls whether sales orders can be settled and to which receivers (COPA, FI, CO-PA).

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7. Assign Settlement Profile to Requirements Class

• SPRO Path:
  Sales and Distribution → Basic Functions → Availability Check and Transfer of Requirements → Transfer of Requirements → Define Requirements Classes
• T-code:OVZG
  • In the requirement class → maintain settlement profile (e.g., SD01).

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8. Assign Results Analysis Key (for WIP/RA if needed)

• SPRO Path:
  Controlling → Product Cost Controlling → Product Cost by Sales Order → Period-End Closing → Results Analysis → Define Results Analysis Key
• T-code:OKG1
  • Define how WIP or revenue recognition is handled for sales orders.

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9. Assign Costing Variants to Requirements Class

• In the Requirements Class (OVZG), assign:
  • Costing variant planned (PPC1)
  • Costing variant actual (PPC2)

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10. Integration with Profitability Analysis (Optional)

• SPRO Path:
  Controlling → Profitability Analysis → Structures → Assign Value Fields
• T-codes:KE4I, KE4M
  • Ensure sales order costs and revenues settle to COPA.

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🔹 Key Transaction Codes for Execution

• CK51N → Create Sales Order Cost Estimate
• KKAX → Calculate WIP for sales orders
• CO88 → Settle Sales Orders
• KE30 → COPA Reporting
• VA01 / VA02 → Create/Change Sales Order

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✅ In summary:
The critical config sequence is:

1. Define Costing Variants (OKKN)
2. Define Valuation Variants (OKK4)
3. Define Settlement Profile (OKO7)
4. Define Results Analysis Key (OKG1) if needed
5. Configure Requirement Class (OVZG) → link costing variant & settlement profile
6. Activate costing for item categories (OKG8)