Profit center

• Profit center accounting helps in analysing

internal operating results.
• It represents an organizational sub-unit that
operates independently and bears
responsibility for its revenue and expenditure
• Profit centers can be setup according to
product lines, division, region, or production
sites.
Profit Center Assignments

• The profit centers are assigned to

various application components /
objects(material master, asset, sales
order, internal order, cost center,
sales order, profitability segment)
which derives the information about
cost and revenue indirectly.
Following were list of profit centres of travis mathew
MASTER DATA
• profit center groups
• profit centers
• Dummy profit center
• Accounts P&L and Balance sheet
items
• Statistical key figures
Hirearchy
Standard hierarchy is a tree structure for grouping
all profit centers which belong to a controlling
area.

Grouping of profit centers according to JWS

criteria.

Profit centers

Dummy profit center is the default profit center

for the entire controlling area. It will capture all
postings that do not have a profit center account
assignment.
Profit center

Give necessary fields and and activate

profit center
Profit center fields
• Baisc data
• Validity period
• Company code assignment
• Address/ communication data
Planning
• Number ranges
• Planning layout
•
Actual Data
• Controlling objects master data contain a profit center field. This is
the link to debits and credits posted to those controlling objects.
• Flow of actual values in profit center accounting comes from
- flow from material management
- flow from sales and distribution
- flow from asset management
- flow from controlling
• When you post data directly in Financial Accounting, all primary cost
elements require an additional assignment to a CO object. The assignment
of this CO object (cost center, order, and so on) to a profit center ensures
that the data is passed on to Profit Center Accounting.
• MM The above example shows the processing of a production order, where
materials are issued to a production order (consumption). The material
document also results in a posting in Profit Center accounting for the
material expense. The profit center will be determined based on the
materials produced.
• SD: The assignment of a sales order to a profit center is passed from the
sales order to the delivery note and then on to the billing document. The
profit center is assigned at the item level of the sales order.
• Which data is transferred to Profit Center Accounting?
• All postings affecting revenue and cost elements
• P&L postings directly coded to a profit center
• P&L accounts maintained with automatic account assignment in PCA customizing
• Balance Sheet accounts maintained with automatic account assignment in PCA customizing
• P&L accounts related to transactions in Logistics
• The data is posted to other objects and passed on from there to a profit center in
Profit Center Accounting. This makes it possible to display your company’s results
by profit center based on the original postings and with no additional work.
• Actual data is reflected in Profit Center Accounting from the account assignment
objects for both postings in Financial Accounting (revenues, primary costs) and
allocations in cost accounting. In addition, you can reflect changes in stock from
Materials Management (MM) and changes to work in process from production
orders, as well as revenues directly from Sales and Distribution (SD) in Profit
Center Accounting.
Planning
 • profit center planning is to
provide data and key figures
for the purpose of planning
for responsibility areas
(profit centers).

Planning profit center