Cost element & is not supported for order settlement

What causes this issue?

The cost element you entered &V1& does exist in the relevant controlling
area, but does not have the cost element type provided for order
settlement cost elements.

System Response

The system issues an error message and will not allow you to continue with this transaction until the error is resolved.

How to fix this error?

Use a different (settlement) cost element, or
Correct your typing error.

Error message extract from SAP system. Copyright SAP SE.