Cost components in Service

In general, cost components are used as a grouping possibility for cost transactions in relation to order systems. In Service, cost components are used differently from the way they are used in Manufacturing. The following is a general explanation of the use of cost components in Service.

Cost components and cost types

In Service there are no constraints that require a cost component to be of a specific cost type. It is preferable to use the Not Applicable cost type within Service.

Cost transactions

For service order actual cost transactions, a cost component must be specified. This is because of the integration with Financials, for global cost control purposes, and for usage in coverage definitions of contracts, service-order quotations, and warranties.

Default value
  • For material cost lines, the cost component is defaulted from item data related to the specified item.
  • For labor lines, the cost component is defaulted from the related task code.
  • Where service order cost lines are copied from reference activities or planned activities, the cost component is defaulted from the cost lines of the activity.
Cost coverage

In the Contract Management module, coverage for contract quotations, contracts, warranties, and service-order quotations can be defined. On the lowest level of coverage term definition of those applications, known as cost terms, it is possible to specify coverage identified by means of cost components. During the costing process of service orders, LN searches in warranty and contract terms, and so on, to get coverage for an actual cost line. In case of coverage definition by means of cost components, LN searches for a match with the cost component as specified on an actual cost line.