You can use one of three types of calculations in the Cost accounting module:

Distributions

Allocations

Cost rates
Before you define these calculations, create a calculation version. The calculation version validates and summarizes the distribution, allocation, and cost rate calculations for a certain period. For more information about how to create a calculation version, see Create a calculation version.
The calculation method that you choose determines how allocations and distributions are calculated. You can select from the following methods of calculation:

Fixed percentage.

Cost category.

Service category.

Cost line.

Reference table.

Reference specification.

Fixed amount.
Distributions
You can use distributions to distribute cost amounts or services that are posted, with or without a dimension, to other dimensions. The distribution is performed on the same cost category as the original posting. For more information about how to distribute costs or quantities, see Distribute costs or quantities.
Allocations
You can use allocations to allocate cost amounts that are posted to a dimension. This allocation enables you to credit one dimension and debit the costs to another dimension. You can only perform these allocations on secondary cost categories.
You can select from three different types of allocations:

Allocation.For more information about defining allocations, see Define an allocation.

Internal cost allocation. For more information about defining internal cost allocations, see Define an internal cost allocation.

Surcharge calculation. For more information about defining surcharge allocations, see Define a surcharge allocation.
Use allocation with the iteration method to reallocate costs to a dimension already credited by a previous allocation .
Example
In a previous allocation cost center, 700 was credited to debit cost centers 710 and 720. Because of that credit, all cost centers are now in balanced status. If you now allocate cost center 710 to the cost centers 700 and 720, the cost center 700 is charged with costs again. The iteration method now repeats the first and second allocation many times until both cost centers (700 and 710) are not fully credited or until the maximum number of iterations defined in the parameters form is not reached.
The allocation with iteration method is created by using the same procedure as an allocation without iteration method. However, the following rules must be considered when you use the iteration method of allocation:

Iteration works only with allocation type Allocation.

The check box Iteration must be selected.

The calculation value type must be set up to Total costs.

The calculation value must be set up to Total value.

The number of iterations must be entered on the Parameters form.
Cost rate calculations
Use cost rate calculations to calculate periodic cost rates from one of the following value types:

Actual costs.

Budget costs.

Basic plan cost

Flexible plan costs.

Target costs.
For more information about how to define cost rate calculations, see Define a cost rate calculation.
All cost balances and cost rates are calculated based on the setup of distribution, allocation, and cost rate calculations after you execute one of the following kinds of periodic work:

Period calculation. For more information about how to create period calculations, see Create a period calculation.

Special calculation. for more information about how to create special allocations, see Create a special calculation.