Double Entry for Cost of Goods Computation using Standard Cost

Hi Experts,

As far as i know, when we are using standard costing in inventory in SAP, COGS is computed using DM and Processing Cost.

But then, as the Bill for Labor and Overhead comes, we are also recording it as part of COGS. I believe that there is a double entry of our COGS computation.

It should be like this: At month end, COGS should be computed using DM at first, then we receive the Billing for Labor and Overhead Cost. Now we can add these 3 to arrive at the real COGS.

         example:

         DM 100

         DL   100

         OH   100

      TOTAL 300 for COGS

NOT like this. SAP will compute COGS using predetermined rate, inclusive of DM, DL and OH.. And then we will receive the billing for Actual Labor and OH, again we will add this for computation of COGS, so there is a double entry.

example:

   COGS @ Standard Cost     100 @ 3 standard cost (DM + Std Labor and Std OH)  =  300

                                          Then we receive the billing for Labor                                100

                                            And billing for OH                                                          100

                                           Total COGS                                                                 500

Please tell me what to do, and correct me if I'm wrong

Thanks in advance