Create Secondary Cost Elements in SAP

Secondary cost elements in SAP are posted exclusively in CO and are not contained in the FI General Ledger. Secondary cost elements are factory Overheads, Administration Overhead, Power, Diesel Oil, gas, etc. 

The cost element categories used are Internal settlements (category 43), order/project analysis (category 31), Overhead Rates (category 41), Assessments (category 42), Overhead Rates (category 41) Internal activity allocation (category 43), project-related incoming orders sales (Category 50)

Note:- Secondary cost elements are not linked to any G/L accounts, COA, where as primary cost elements are linked to general ledger accounts in SAP

  • SAP Menu Path :- Accounting > Controlling > Cost element accounting > Mater data > Cost element > Individual processing > Create secondary
  • Transaction code : – KA06

Step 1 :- Enter transaction code KA06 and press enter

Secondary Cost Elements - T code ka06

Enter controlling area and press enter

Secondary Cost Elements - Controlling area

Step 2: – Update the following information and press enter

  • Enter the Secondary cost element in the cost element field
  • Enter the valid period from to end period of the cost element

Secondary Cost Elements

Step 3 : – In the next screen update the following data

  • Name:– Enter the name of the cost element
  • Description:– Enter the description of the cost element
  • CElem category: – Select item category for the cost elements. It mainly controls the category of cost elements

create secondary cost elements

Click on the save icon or press keys ctrl+s to save the configured secondary cost elements in the SAP system.