Manage Accounting Overhead Rules

Summary:

Difference between Material Group and Transaction Cost

Content (required):

I am creating overhead rule for an item with cost basis as percentage value and see two different options in 'Based on' field i.e. 'Material Group' and 'Transaction Cost'. I see below difference but would like to understand the Business scenarios behind these two options -

1.Material Group - Group of cost elements of element type Material forming part of the transaction cost

2.Transaction Cost - Group of cost elements with the exception of cost elements of element type Overhead forming part of the transaction cost

We are having item storage overhead which needs to be captured for Inventory Transfer order when item is transferred from one warehouse to another.