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SAP Assembly Scrap Basics

JJ old

SAP assembly scrap allows you to plan for faulty assemblies.

Since no production process is perfect, there is always a percentage scrap produced. You can either scrap or rework assemblies and components that do not meet quality standards. Depending on the problem, you may scrap cheaper items and rework costly items.

When working on SAP Scrap we recommend you work with our ERPCorp experts: Learn about ERPCorp Coaching & Consulting.


Let’s follow a example: You plan to produce 100 finished printed circuit boards (PCBs). Plan assembly scrap for the finished PCBs increases component and activity quantities by 10% as shown in the Quantity costed column in Figure 1 below.

Assembly Scrap

Figure 1: Component and Activity Quantities with Assembly Scrap

Assembly scrap increases the plan cost of producing the finished PCBs by increasing lower-level quantities. Material requirements planning (MRP) proposes a production quantity of 110 assemblies expecting 100 delivered to inventory and 10 confirmed as scrap.

You plan assembly scrap in the material master with Transaction MM02 or by following the menu path:

Logistics • Materials Management • Material Master • Material • Change • Immediately

Navigate to the MRP 1 view to display the screen in Figure 2.

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Figure 2: Assembly Scrap Field in MRP 1 View

Complete the Assembly scrap (%) field with a flat rate percentage determined by your historical production scrap rate statistics. You update this field prior to the next costing run if statistics change.

Plann assembly scrap costs are included in the standard cost estimate. You can display how assembly scrap affects costs by creating a standard cost estimate with Transaction CK11N or by following menu path:

Accounting • Controlling • Product Cost Controlling • Product Cost Planning • Material Costing • Cost Estimate with Quantity Structure • Create

A standard cost estimate including assembly scrap is shown in Figure 3 below.

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Figure 3: Cost Estimate with Assembly Scrap

You can see the value of scrapped components in the Scrap column and corresponding quantity in the Scrap quantity column. While only material cost estimates are displayed in Figure 3, the quantity and value of all other items including activities and overhead are also increased by 10%.

You analyze scrap variance in detailed reports: transactions PKBC_PKO & PKBC_ORD.

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Tip 57 from 100 Things You Should Know About Controlling with SAP 2nd Ed

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Saturday, 25 June 2022

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