You can move partially completed assemblies that you consider unrecoverable to the scrap intraoperation step of that operation. If necessary, you can recover assemblies from scrap by moving them to another intraoperation step. By moving into the scrap intraoperation step, you can effectively isolate good assemblies from bad.
WIP considers a move into the scrap intraoperation step from the queue or run of the same operation as an operation completion, and thus updates operation completion information, backflushes components, and charges resource and overhead costs according to the elemental cost setup. You can also move assemblies back to the scrap intraoperation step of the previous operation for queue or run if no work has been completed at the current operation.
Costing Assembly Scrap Transactions
When you define WIP parameters, you can specify whether moves into the scrap intraoperation step require a scrap account. If you enter a scrap account or alias when you move assemblies into scrap, then the scrap account is debited and the job or repetitive schedule elemental accounts for the standard cost of the assembly through the scrap operation are credited. This removes the cost of the scrapped assemblies from the job or repetitive schedule. If you do not enter a scrap account or select an alias, then the cost of the scrap remains in the job or schedule until job or period close. If you recover assemblies from scrap, then the scrap account is credited and the job or repetitive schedule elemental accounts for the standard cost of this assembly through this operation are debited. Here are the accounting entries for scrap transactions: