Scrap expected to occur during the production of a material that is used as an assembly.
An assembly is a material with a BOM, that is, a group of components of a product which form a technically coherent whole in the production process. The assembly can be contained as a component in another assembly.
If a certain amount of scrap always occurs during the production of an assembly, the quantities and activities used must be increased by the system so that the required lot size can be produced.
To increase the lot size of an assembly, you can enter a percentage, flat-rate assembly scrap in the MRP 1 view of thematerial master record. This assembly scrap is reflected in all the subordinate components. The system increases the quantity to be produced by the calculated scrap quantity. This increases both the materials consumed and the activities consumed.
You are producing 100 circuit boards. In the material master of the finished circuit boards, you have entered an assembly scrap of 10%. When you produce the circuit boards, the system increases the required quantities and activities so that the required lot size of 100 units can be costed or produced.
When you produce the boards, requirements planning increases the requirement for the boards to 110 units. This means that the requirement for the components in this assembly are also increased. The quantity and activity consumption for the subordinate components is increased as though 110 boards were to be costed or produced. The system costs the 100 boards based on 110 units and calculates a scrap quantity of 10 units for the three subordinate components. The activity consumption for the two operations is also increased by 10% to 110 units.
Assembly and Operation Scrap
You can have the system calculate assembly scrap using theoperation scrap. The system calculates assembly scrap from the operations in the routing when you schedule a routing and then update the scheduling results in the material master record.
If you have not entered an operation scrap, or do not want to determine the assembly scrap through scheduling, you can also enter the assembly scrap manually in the material master record. However, if you do so, the system cannot calculate any scrap variances.
The assembly scrap is ignored if the Net indicator is turned on in the BOM item. This indicator controls the calculation of the operation scrap based on the net input quantity (without assembly scrap).
- If you enter operation scrap in the BOM, you must set this indicator. If operation scrap has been entered in the BOM, the system uses the operation scrap.
- If no operation scrap has been entered in the BOM and the indicator has been set, the system does not include either operation scrap or assembly scrap.
Assembly and Component Scrap
When both assembly and component scrap has been entered for a material, the entries are dependent on whether the material is being used as an assembly or as a component.
Assembly and Component Scrap (I)
You are producing 100 circuit boards. In the material master for the finished circuit boards, you have entered an assembly scrap of 10%, while in the material master for the processor you have entered a component scrap of 5%.
The system costs the 100 boards based on 110units and calculates a scrap quantity of 10 units for the subordinate components. Due to the component scrap for the processor, the system determines a total scrap quantity of 16 units, being 10 units assembly scrap and 6 units component scrap. The activity consumption is increased accordingly.
Assembly and Component Scrap (II)
In the material master for the finished circuit boards, you have entered assembly and component scraps of 10% and 5% respectively. The question of whether the finished circuit boards are used as an assembly or component determines which of the scrap entries is included by the system. If the circuit boards are used as a component, the system includes the component scrap, and vice versa.
For more information about the effects of component scrap, seeComponent Scrap.