What is the difference between by-product and co-product and
how do you differentiate them in a BOM?
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Answer Posted / sandip deshmukh
By-Product : By-Product is a Product Created While Making
Production
1. The System Does not create a separate order item for each
by-Product
2. The Material Valuation of a by-Product is always based on
the price, specified by the price control in the material master
3. The by-product must be listed as an item in the bill of
material of the main product .The bill of material item must
have a negative quantity (for example ‘1 -’)
4. Byproduct has only the -ve quantity in BOM component, it
does not go for joint production costing.
5. Movement type 531 to post the By-Product during
Confirmation.
6. Settlement of cost is done to the header of the material
Co-Product :A co-product is a product that is produced in
conjunction with other products. The system creates a
separate order item in the production order for each
co-product. As a result, it is possible to display actual
costs at co-product
Settings: 1.) You have to activate check box in MRP2 view
for co product.
2.) For co products we also need to define the apportionate
structure with equivalence number for costing purpose, this
will be done in "Joint Production" details in the same view.
(30:30:20:20)
Prerequisite for the main product:
1.) The indicator Co-product must be activated in the
material master of the main product (MRP area)
Prerequisites for a co-product:
1.) The indicator Co-product must be activated in the
material master of the co-product (MRP area)
The co-product must be listed as an item in the bill of
material of the main product
2.) On the Basic data tab page of the BOM item, the
indicator Co-product must be activated in the field group
General data
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