The business object cost object hierarchy contains nodes structured into a hierarchy.
A cost object hierarchy can be used to analyze target costs, actual costs, and variances in situations where costs cannot be collected at the level of orders or materials.
A cost object hierarchy consists of cost object nodes to which materials and production versions can be assigned and through which the associated orders can be selected.
At the level of the cost object hierarchy, price differences can be passed on to inventory and from there to Financial Accounting and Profitability Analysis.
It is also possible to distribute the costs to the assigned orders.