David Krause4.1 Why the income statement isn't enough
Financial accounting fulfils legal obligations: it documents past transactions under commercial and tax law. Cost accounting has a different goal — to show what a product actually costs, so it can be priced correctly. The two overlap only partly.
Three examples of the gap: trade tax is in the P&L but does not belong in the price of a part. Book depreciation is calculated on the purchase price, costing needs the replacement value. And the entrepreneur's salary of a sole proprietor is not in the P&L at all — yet it does cost the company money.
4.2 The four cost categories
Every P&L item falls into exactly one of these categories. The classification determines the treatment:
Different costs are not eliminated, they are replaced. Whoever deletes book depreciation and puts nothing in its place calculates without depreciation — the hour rate collapses and every machine stops earning its replacement. The correct procedure is two-stage: book depreciation out, imputed depreciation on the replacement value in.
4.3 What the income statement conceals: imputed costs
| Cost type | Why it's missing | Approach |
|---|---|---|
| Imputed depreciation | Books depreciate on historical acquisition cost and the tax useful life | replacement value / technical useful life → Chapter 6 |
| Imputed interest | Interest on equity appears nowhere — yet the money is tied up | operating capital × rate × 0.5 |
| Imputed entrepreneur's salary | In sole proprietorships and partnerships, the profit is the salary | market-rate managing-director salary for comparable responsibility |
All three items describe real economic burdens that tax law simply does not recognize. Leaving them out structurally undercuts your own cost base — and then you wonder why nothing is left at full utilization. In the reference company, imputed costs alone amount to around €70,000/year for cost center 210, that is over €20 per machine hour.
| Step | Formula | Example CNC turning center |
|---|---|---|
| 1 · determine replacement value | acquisition × price index | 340,000 × 1.21 = €411,400 |
| 2 · set technical useful life | consider shift model | 13 years (two-shift) |
| 3 · imputed depr./year | replacement value / useful life | 411,400 / 13 = €31,646 |
| 4 · compare with book depr. | acquisition / tax life | 340,000 / 8 = €42,500 |
Imputed depreciation continues over the entire technical life — even when the machine is long written off for tax. That is exactly what prevents an old but productive machine from appearing to be costed "for free".
Example: €412,000 × 5 % × 0.5 = €10,300/year
The factor 0.5 reflects the capital tied up declining linearly over the useful life. Interest is charged on the operating capital — regardless of whether it is equity or debt.
Relevant only for sole proprietorships and partnerships where the owner draws no managing-director salary. The figure used is what an employed managing director would earn for the same activity (orientation: €80,000–140,000/year depending on company size). In a limited company the item is already included as salary in the P&L and does not apply here — otherwise it would count twice.
Individual risks — bad debts, warranty, scrap risks — are applied as a flat rate (warranty typically 0.5–2 % of revenue, scrap depending on the process). Condition: the actual costs are then no longer additionally carried in as neutral expense from the P&L — otherwise the risk counts twice. The general entrepreneurial risk does not belong here; it is compensated through profit.
4.4 Period allocation
The second reconciliation is temporal. One-off payments must not distort the month in which they fall — otherwise the hour rate jumps and becomes useless for quotes.
| Item | Payment | Imputed approach |
|---|---|---|
| Business liability insurance | once a year in March | 1/12 per month |
| Christmas bonus | November | 1/12 per month |
| Major machine inspection | every 3 years | 1/36 per month |
| Annual software license | January | 1/12 per month |
4.5 The cost-type plan: 24 nodes
The result of reconciliation is a cost-type plan that structures all relevant costs — from direct costs through overhead and imputed costs to the neutral items that are set aside. The scheme applies to manufacturing companies regardless of industry and size.
| No. | Group | Content | SKR03 |
|---|---|---|---|
| 01 | Direct material costs | production material, raw materials, semi-finished — directly in the product | 3200–3299 |
| 02 | Direct labor costs | wages of productively working operators | 4110 |
| 03 | Special direct manufacturing costs | order-specific tools, molds, fixtures | individual |
| 04–13 | Overhead | indirect wages, salaries, energy, maintenance, consumable tools, space, insurance, IT, marketing, other | 3xxx–4xxx |
| 14–17 | Imputed costs | depreciation on replacement value, interest, entrepreneur's salary, risk | — |
| 18–24 | Neutral items | income taxes, donations, prior-period and extraordinary expenses — set aside | 2200, 2208, 4320, 2380 ff. |
The reconciliation mapper takes a DATEV trial balance and assigns the accounts to these 24 nodes — rule-based, with manual correction and entirely offline in the browser. How it works technically is described in the article on local language models (DE).
4.6 From the P&L to the chargeable cost block
− neutral expenses
− different costs (book values)
+ imputed costs
= chargeable costs of cost accounting
Only this block enters the cost center accounting sheet — and is distributed across the cost centers there. Without clean reconciliation every following stage inherits the error: the BAB distributes wrong amounts, the machine hour rate comes out wrong, and every quote carries the deviation onward.
4.7 SKR03 / SKR04 — account mapping to cost accounting
The following excerpt shows the cost-accounting-relevant accounts with their mapping to the nodes of the cost-type plan. Accounts not listed generally fall under neutral expenses (NC) or are not cost-accounting-relevant. DC = direct costs, OH = overhead, IC = imputed costs, NC = neutral.
| Account | Description | Node / cost type | Type |
|---|---|---|---|
| 3200–3299 | Production material / raw materials | 01 direct material costs | DC |
| 3000–3099 | Auxiliary and operating materials | 04 auxiliary/operating materials | OH |
| 4100 | Direct manufacturing wages | 02 direct labor costs | DC |
| 4110, 4190 | Indirect wages (setters, transport) | 06 manufacturing overhead | OH |
| 4150–4199 | Social costs manufacturing (employer share) | 06 manufacturing overhead | OH |
| 4800–4804 | Maintenance / repair | 08 maintenance | OH |
| 4830 | Book depreciation ⚠️ | 16 → replace with imputed depr. | DfC |
| 4993 | Imputed depreciation | 17 imputed depr. (replacement value / useful life) | IC |
| 4992 | Imputed interest | 18 imputed interest (replacement value × i × 0.5) | IC |
| 4991 | Imputed rent (only if owned) | 19 imputed rent | IC |
| 4990 | Imputed entrepreneur's salary (only sole prop./partnership) | 20 imputed salary | IC |
| 2375 | Property tax (expense tax) | 15 other overhead | OH |
| 4510 | Vehicle tax (expense tax) | 15 other overhead | OH |
| 2200, 2208 | Corporate/trade tax, soli surcharge | 23 income taxes | NC |
SKR04 follows the balance-sheet structure instead of process logic. For cost accounting the systematics of the account numbers change, not the mapping to the nodes: material expense is in class 5xxx in SKR04 (instead of 3xxx), personnel expense in 6xxx (instead of 4xxx), depreciation in 62xx. The rule "replace book depreciation with imputed depreciation" and the treatment of expense taxes apply unchanged.
Regrinding costs belong methodically with consumable tools (node 05), not with maintenance — keep them in a company-specific sub-account in the SKR. The standard account 4805 is repair/maintenance of operating and business equipment and would wrongly pull the tooling cost into maintenance.
4.8 Checklist: building cost-type accounting
- ☐ 1Structure P&L balances by cost type (SKR03/04)Ch. 4.5
- ☐ 2Set aside neutral expenses (non-operational, prior-period, extraordinary)Ch. 4.3
- ☐ 3Replace book depr. with imputed depr. (replacement value / technical life)Ch. 6
- ☐ 4Apply imputed interest on operating capital
- ☐ 5Imputed entrepreneur's salary — only for sole prop. / partnership
- ☐ 6Imputed risk as flat rate, then no actual costs double-counted
- ☐ 7Separate direct from overhead costs (surcharge base vs. BAB)Ch. 5
- ☐ 8Result = chargeable cost block for the BABCh. 4.6
4.9 Formula reference: imputed costs
imputed interest = replacement value × rate × 0.5
imputed salary = market MD salary (only sole prop. / partnership)
imputed risk = reference base × risk rate (e.g. revenue × 1 %)
replacement value = acquisition × price index (PPI, GENESIS 61241)
Chapter 5 takes this cost block and distributes it across the cost centers in the cost center accounting sheet — with primary and secondary allocation. At the end stand the surcharge rates that every calculation works with from Chapter 10 on.
