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Disposition codes

Disposition codes can be sued indicate whether additional action is required for a transaction e.g. to:

Scrap the returned item and provide a replacement item to the customer.
Return the item to inventory and credit the customer for the cost of the item.
Repair the item and return it to the customer.

The disposition code itself may not create a posting, whereas undertaking those actions e.g scrapping an item does in the same way you scrap any item without a disposition code.

You can however associate Charges with a disposition code (as you would for a landed cost) as a simple way of allocating cost than e.g creating a rework production order you might just do the work of e.g, inspection and cleaning as a manual process outside the system and just collect a cost based on a charge, which itself is based on a disposition code.

Click the Charges button to open the Set up charges form.

There are many disposition codes suggested in help, but most of these are not pre-defined in the sense of posting profiles but are just examples of codes you could define - you can use any codes you want.

As Docs puts it:

"The disposition action determines the physical and financial implications of the disposition codes. For example, the disposition action determines the physical handling of the returned item, the financial effect of the returned item, and if a replacement item must be sent to the customer. You can define an unlimited number of disposition codes according to your business needs, but there are only six predefined disposition actions that you can select from."

The pre-defined codes are:

Disposition action	Description
Credit	Return the item to inventory and credit the customer.
Credit only	Credit the customer without requiring or expecting the item to be returned.
Scrap	Scrap the item and credit the customer.
Replace and credit	Return the item to inventory, create a replacement order, and credit the customer.
Replace and scrap	Scrap the item, create a replacement order, and credit the customer.
Return to customer	Reject the returned item and return it to the customer.

The financial postings for those actions, are the same as they would be if you did those actions and did not process returns using disposition codes - the only difference is any set up you have made for additional disposition charges.

So Ax uses the ledger accounts in the inventory posting under inventory Management - Setup - posting - posting.

You can also add charges to reason codes.

Note understand whether you need a quarantine warehouse for this to work.

this useful table is from Evert Bos