Production Order Scrap flow

[Former Member]

Can anyone Explain about the Standard Scrap flow in the Production Order

[Former Member · Accepted solution]

Dear lakshmi,

In standard SAP we have nearly 4 types of scrp which affected our finish product order qty & its bom component req. qty. they can be chooses by us.

1. Assembly scrap :- it can be define in MRP 01 tab it increase finish product qty. so bom component qty increased automatically. Ex. if required qty. 100 & we give 5% assembly scrap then after mrp running we get plane order of 105 unit & bom component qty. respectively.

2. Component scrap :- It can be define in MRP 04 tab it not increase finish product qty. only increase bom component qty.

EX. Suppose a material A have its bom component B

Requirement of A is 100 unit & neaded 2 unit of B to create 1 unit of A then we needed 200 unit of B.

Now we put component scrap 5% so for completing requirement we needed 100 unit finish product for making which we needed 210 unit B i place of 200.

suppose 5% assembly scrap & 5% component scrap

100 unit requirement finish product 105 unit bom com 231 unit

3. Operation Scrap :- This can we apply in Routing operation detail.

It reduces the component for subsequent operation suppose we make 100 unit in operation 10 but if we put operation scrap 5% then we neaded to work only 95 unit in operation 20.

4.Operation Scrap with Net indicator:- It used to over come of operation scrap also applied in Routing or in production order for a perticular material so this material is neaded according to operation 20 qty in operation 10.

Thanks

[Former Member]

Thank you all for your answers

[former_member184655]

Dear Lakshmi,

Raw material's Operation scrap will be given in BOM item data.

When u create a BOM for a material and while including the raw materials,select the entire row & click on Item data or press F7.

In the Item data page u will be finding the field for operation sracp,there u can maintain the operation scrap.

Apart frm this scrap,there are 2 more scraps

Assembly scrap - maintained in MRP1 view.

Component scrap - maintained in MRP4 view of the material master.

This is used for planning the material.

But after executing production ,if u find some HALB's or FERT's are not ok,then u you enter those quantity under scrap column while doing production booking in CO11N.

I hope now u must be able to understand the difference between the scrap's which's used for planning and the productionscrap.

<b>If satisfied reward points and close the thread if so.</b>

Thanks & Regards

Mangal

[former_member184655]

Hi Lakshmi,

If you are statisfied with the answers <b>,please reward points and close the thread as answered</b>

Regards

Mangal

[former_member184655]

Dear Lakshmi,

If you are satisfied with the answers given,Please reward points to the answers

whichever has helped you and please close the thread as answered.

Thanks & Regards

Mangal

[Former Member]

The below extract is from SAP help:

Scrap is that portion of a material which does not conform to quality standards and which is not reworked.

If you are collecting costs on manufacturing orders, you can post the scrap costs to a cost center. You cannot settle scrap costs to a cost center if you are using a product cost collector.

<i><b>Process Flow</b></i>

The planned quantity of the order is 10 units. The yield is 8 pieces and the scrap quantity is 2 pieces.

You change the settlement rule so that 80% of the costs can be settled to the material stock account for that material. You then create a new distribution rule in which the remaining 20% of the costs is settled to a cost center.

The actual costs for the order are USD 2,800. When 8 pieces are delivered to stock, the system charges USD 2,000 to the order.

80% of the total cost is USD 2,240.

20% of the total cost is USD 560.

The order was already credited by USD 2,000 upon delivery. During settlement, the system then settled USD 240 to the material stock account of the material and USD 560 to the cost center.

<b>Settement:</b>

In the standard system, all actual costs incurred in an order are settled 100 % to the material produced. Any scrap produced in the production process causes the average price to increase in the standard system, due to the difference between the order quantity and the actual yield. To avoid the price of the material increasing when scrap occurs, you must manually adjust the percentage of the existing distribution rule to the actual yield produced and then create a new distribution rule for the actual scrap percentage. You could then, for example, enter a cost center as the settlement receiver for the new distribution rule.

<b>Example of settement:</b>

The order quantity to be manufactured is 10 pieces. The actual yield is 8 pieces, the scrap quantity is 2 pieces.

You change the distribution rule in the settlement rule so that only 80 % of the costs are settled to the stock account of the material. Then you create a second distribution rule that specifies that the remaining 20% of the costs are to be settled to a cost center.

The actual costs for the order are US$ 2,800. Due to the delivery of 8 pieces to stock, the order was credited with US$ 2,000.

80% of the total costs are US$ 2,240.

20% of the total costs are US$ 560.

The order has already been credited with US$ 2,000 due to the delivery to stock.

As a result, US$ 240 is settled to the stock account for the material and US$ 560 to the cost center.

Regards

TAJUDDIN

Message was edited by:

TAJUDDIN MOHAMMED

[Former Member]

Dear all,

i am satisfied with your answer , But I am thinking abt the Raw Material Operation scrap , It shuld be related with that particular Production Order , What is the Impact on Costing, Where can i get the Scrap Report for the Particular Production Order.

Please reply me.

[former_member184655]

Hi Lakshmi kindly go through this link and below given example

<u>http://help.sap.com/saphelp_470/helpdata/en/a5/63198843a211d189410000e829fbbd/frameset.htm</u>

Example for Settling scrap(Taken from SAP help)

The order quantity to be manufactured is 10 pieces. The actual yield is 8 pieces, the scrap quantity is 2 pieces.

You change the distribution rule in the settlement rule so that only 80 % of the costs are settled to the stock account of the material. Then you create a second distribution rule that specifies that the remaining 20% of the costs are to be settled to a cost center.

The actual costs for the order are US$ 2,800. Due to the delivery of 8 pieces to stock, the order was credited with US$ 2,000.

80% of the total costs are US$ 2,240.

20% of the total costs are US$ 560.

The order has already been credited with US$ 2,000 due to the delivery to stock.

As a result, US$ 240 is settled to the stock account for the material and US$ 560 to the cost center.

Thanks & Regards

Mangal

Message was edited by:

Mangal

[Former Member]

Lakshmi,

The effect of scrap confirmation inthe prod order is that the operation qty reduces by that amount in the succeding operation. The scrap percentages can be mentioned in the Material master MRP view (assembly scrap) so that the order qty is automatically increased by that an=mount while creation of a new order.

There are no material movements becasue of confirmation. If you want to bring the scarp in the stock then define it as a material and make goods movement manually with movement type 531 in MB1C transaction. You can also automate this in confirmation process by defining a negative qty in the BoM of the finished goods.

Hope this is clear.

Regards

Ram