A sub-total as the name implies holds temporary totals before the final price is calculated. As shown in the picture below, the Gross price is a sub-total that results from the base price. The Net Price is a sub-total that is arrived at subtracting the Discount percentage off of the Gross Price. There are many additional steps that might be required to arrive at the final price. For example, if the item is taxable, should the tax be applied on the Gross Price or the Net Price..? That actually depends on the business scenario. However, the Sub-totals allow for easily identifying and computing values for further use.
Alternative Calculation Type
The value 5.00 for the Base Price ( shown in the picture above ) is derived based on condition records which we will see much further in the discussion. However, if the condition type should NOT be calculated based on a condition record, but should be calculated based on an external or internal logic, then an alternative calculation routine should be used. Each alternative calculation routine is a 3 digit number between 1 and 999 that contains a piece of code that does some calculation either internally or externally and returns a value. That value will be used to calculate the condition type as opposed to a condition record. A simple example for the same is US Taxes.
Taxes in the US and Canada are based on Jurisdiction code. There are around 50000+ jurisdiction codes in the US alone ( Based on all possible variations of City, County, State and District ). And they change continuously. So it is not practical for companies to keep track of the changes in tax rates. There are external tax companies ( Called Tax Vendors ) that only does this. So it is wiser for companies to just call an external tax vendor using a remote function call, get the tax rate as relevant for the corresponding jurisdiction code and return that value to the pricing procedure.
For a full version of this article, please visit http://magnatraining.com/sap/sap-tutorials/sap-sd/sap-sd-pricing-fundamentals and http://magnatraining.com/sap/sap-training/sap-sd-training for SAP SD Training.
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