Example 2: Scrap Transactions - Costing

Operation	Control Point	Qty Complete	Qty Scrap
10	No	5
20	No	5
30	Yes	5
40	No	5
50	No		5
60	Yes

In contrast to production schedule complete transactions, which you record at control points, you report scrap transactions at any operation. In the above example, assume that you reported a quantity of 5 as complete for Operation 30. If you reported a quantity of 5 as scrapped at Operation 50, the system would also backflush for Operations 40 and 50. The system would not scrap 5 or backflush for operation 30 (or prior to it), because it is a control point.

However, the system would calculate the accumulated WIP costs of the scrapped materials for all operations, 10 through 50 inclusive, and move them to the Scrap Expense account.