Please help me understand if I am handling scrap correctly. Currently I post the scrap quantity at the relevant step e.g. if 100 items were ordered and manufactured and 5 were scrapped at milling (work centre W001), I post at that step 95 output and 5 scrap in the production journal. What I then do is I post only 95 output, if there are no additional scrap, for the rest of the steps except for the final step. At the final step of the routing, I again post the 100 because otherwise the released production order wont close without changing the quantity in the item tracking lines to 95. What I do after posting 100 at the final step and closing the order, is I transfer the 95 that is correct to stock room (003 location), via transfers to ship and receive, and I transfer the 5 that were scrapped to 023 location (scrap location), via transfers to ship and receive, and I physically throw the scrapped items away. Then once a week I "empty" the 023 location by posting a negative adjustment in the item journals for everything that is in 023 location.
It is important for quality, corrective action, finance and inventory monitoring to accurately keep track of scrap.
What would you say is the best way to handle scarp on NAV dynamics in terms of inventory keep and cost accounting
