Scrap in Subcontracting

Hi all
can some one tell me
How is scrap accounted in subcontracting ?
regards
Bhushan.N

By-Products in Subcontracting (Scrap)
You can use subcontract orders to plan the receipt of by-products from subcontracting:
Similiar to production order processing, by-products are entered in the subcontract order as components with negative quantity.
In the provision of the components (with reference to the purchase order, for example), the system ignores the negative component items.
In the goods receipt for the purchase order, the system automatically posts the receipt of the by-products. In the material document, you can identify the by-product items from their movement type 544. Note that the by-products are posted to the "stock of material provided to vendor" (also referred to as "subcontracting stock").
The receipt can still be corrected using the Subsequent Adjustment function.
Due to the receipt of the by-products, the value of the manufactured material is reduced.
To transfer the by-products quantities from the "stock of material provided to vendor" (or subcontracting stock) to the unrestricted-use stock, you enter a transfer posting using movement type 542 (reversal of the provision of the components).
Regards
Biswajit

Similar Messages

Assembly scraps for subcontracting

Dear gurus,
I would that MRP consider assembly scrap (%) present in material master data to calculate planed order quantity of components of materials procuremented by subcontracting.
Is it possible?
Thanks in advance.
Best regards.
Juan

Dears all,
this the answer of Sap:
Assembly scrap is only used when the assembly is In House.
That is, when the material is produced internally.
I regret this can´t be changed.
If you want to increase the components qty you have to use the
'component scrap' field iin the BOM item.
In fact you have to do for all the items of the BOM,
unfortunately CS20 is not useful for this update.
I regret I can´t provide any other workaround, the
desired field can´t be check in external procurement.
However thanks for your help.
Sys,
Juan

Scrapping through subcontracting

hi sap gurus,
one scenario,
suppose one company sends the Raw cyilderical block material to the subcontracting vendor and after couple of days we he sends us a finished goods with scrapping of 40 % material. then any body let me know how t o slove this issue.
upto now so far
i create a mmr where i have assigned the componenet of scrapp percantage is 40% in mrp views, but when i create me21n for that material, it showing that scrapp percantage is 0%. why so like that
plzzzzzz

HI,
You will have to define the BOM in which u can defeine the materials for scrap.BOM is defined in CS01.
Else when u raise the PO with L' item category you can define the scrap generated in the Item details in the components tab.
Then when the MIGO is done the scrap shall be considered. Else if BOM is defined automatically the net Qty will be send excluding the scrap.
You dont define the scrap Qty in the MMR.
Hope this helps.
Regards,
Prasanna
Award pls if helpful.

Regarding Scrap through Subcontracting

hi Sapgurus,
i have done the scenario of Subcontracting with Scrapping,
from the P.O. to MIGO. evryting is correct.
but the system doesnot ask for storage location the MIGO screen while receiving.
and when i did , the system save the document.
but when i went to MMBE, i am not able to see any update quantity of teh scrapp quanity.

Hi
Storage location is generally not asked if your PO is account assigned PO.
I would suggest you to goto transaction MB5B and check the various movement types for that material in a particular plant.
This will give you the fair idea whether your GR is done properly or not.
In case of PM order GR quantity is settled on PM order directly. It doesn't appear in MMBE.
Regards
Karan

By-product subcontracting process

what is the By-Product process in subcontracting,please explain whole process with tcode and movement type?? .which is t-code and movement tpe we supply the assemble goods and which is movement type we consume it ad what are the the process we receive the component please explain in detail.

Dear Friend,
While creating the purchase order in components you can maintain the by product what your getting from the subcontractor in
negative value (you has to define new material for by products),
this scenario will be help full when by product will be getting back to your premises when you receive finished material from vendor it will be received by 101, consume the raw material by 543, and receive the by product by 545 movement type
if your not receiving back that material at the time use 551 O for sending the material to the scrap for subcontract material
Regards
Pramod

By product and scrap in SC?

hi
SOme body explain me about the difference between the byproduct and scrap in subcontracting process.
In which kind scenario these both will come in SC process.
Thanks

in SAP point of view of both are same .
But business process point of view it diiffers according to the industries
By product:
To make material A , we have to process material C and D . Apart from A , we get the by product E ,which woud be used for other purpose .
eg:Chemical ,pharmaceutical industries
To make SOAP we have to mix Oil and soda . along with soap ,we gets glycerine as a byproduct.
Scrap:
This is mainly in mechanical industries.
For when you make bolt,you will get some scrap ,this you can sell it.
SAP point of view
1.if the scrap/by product known in advance ,it should me maintained as negative in the BOM
2. if you want to maintain inventory for that scrap/by product ,use appropriate material type like ROH
3. if it is non-valuated/non-stock ,maintain it accordingly in the BOM
Inventory movement
1.Move type 545 O used by the system to generate scrap/by prodect and it is still *stock of material provided to vendor *
2. To get into our plant use move type 542.
3.Under consumption means in scrap ,it is over generated than in the BOM .system uses mov type 545 O +
4.over consumption means ,it is less generated compared to BOM qty,system uses move type 546 O -
hope it clarifies

About subcontracting

how to define scrap in subcontracting with accounting effect and registers?

Hi,
Create a separate material number for scrap and maintain as negative qty.in BOM
or assign as negative in component assignment while po
It will update all accounting entries
BR
Diwakar

Subcon PO: Can system change the qty proposed for backflush during GR?

Scenario:
We have a Subassy A (qty=1) which requires Component A (qty =8). We have component scrap maintained as 25% in the BOM.
When we create the PO with qty as shown below, the following qty is proposed for the component A (80*1.25 = 100) due to component scrap.
Subcontract PO with item cat L - Subassy A : qty = 10
Component proposed is - Component A : 100
During GR we (101) the Subaasy A: qty = 10
We backflush (543) the Component A qty =80 (system proposes qty =100 but we change it to 80.00)
In subsquent adjustment, MB04 we consume/backflush (543) the additional issued components.
Problem:
IS it possible to have the system propose the component A qty as per the BOM ie (80 for 10 Subassy A parts)
so that inventory control does not have to change the proposed qty during GR.
Thank you in advance.

Hi,
You should try this.
Create an entry sheet in which planned services are defaulted from the purchase order. You can determine the quantities suggested from the PO by specifying percentages (Entry sheet -> Create -> With planned services).
Cheers !

Creation of challan during the return delivary to vendor in sub contracting

Dear All,
I have a requirement where my client wants to have a challan made for materials that they are sending back via return delivary.
scenario
In the subcontracting process we are receiving the goods via MIGO but with Quality inspection enabled. For ex: we have recieved 100 goods from a sub contractor(BOM component ratio= 1:1 with the finished product and the component). Now in qa32 we have generated the lot of 100 materials. Now out of the 100 we have accepted and posted 50 materials in the unrestricted field in the inspection lot tab of usage decision and rejected the rest.
Here rejected the rest means we have entered the 50 remaining materials in the return delivary tab. Now when we post it we can see that system immediately has posyted a material document in the background for movemnt type 122 for the materials that we have done the return delivery. There is a change in stock in MMBE also.
I WANT TO HAVE A CHALLAN CREATED FOR THOSE MATERIALS THAT ARE SENT AGAIN TO THE VENDOR.
IS IT POSSIBLE??? CAN WE INCLUDE 122 MOV TYPE IN THE MOV TYPE GROUP AND IF I ADD WHAT IMPACT WILL IT HAVE .
pL DISCUSS.

Hi,
Two options to consider.
When the GR has been posted for the finished product and the vendor indicates that they used more (or lost some in the process) you can change the quantities in MIGO at the time of GR (by expanding the lines and changing the quantities), or or you can do this later by using a "susequent adjustment".
If you mean scrapping that does not relate to one PO then what we have done in the past is just to carry out regular stock checks and any shortages are handled by posting the difference via a scrapping movement type (remember you can scrap from subcontract directly).
I am sure that there are other options but these have worked in several implementations so far.
Steve B
Message was edited by:
Stephen Birchall

Capital purchase

hi all,
scenario :-
PO is showing BED 1600 ( AAC is A and procurement is without master)....
while doin GR no accounting doc is generated and excise values are nt cuming on MIGO screen ....
Regards
sap mm

Hi,
A. Asset:
For asset, you have create asset class (The asset class is used to group assets of the same class for better management of asset data and reporting) and then
1.Master Data
Create Main Asset                    AS01
Create Sub-asset Master           - AS11
2.Transactional Data are
Asset Purchase posting             - F-90
Posting of Depreciation            - AFAB
Asset Sale                                 -   F-92
Asset Transfer                          -   ABUMN
Asset scrapping                        -   ABAVN
B. Scraps in Subcontracting: You have a material (Finished Goods) that can be procured externally by a vendor, and you have maintained BOM (CS01) with components (Raw Materials). Any scraps generated during subcontracting process can be maintained as component with negative quantity in the BOM(CS01). Components (Raw Materials) supplied to Vendor in ME2O or MB1B with 541 movement type. When u will receive Finished Goods with MIGO with 101 movement type.You will receive all scraps(545) and supplied automatically.
Regards,
Biju K

Scrap of material in subcontract and Excess material issue

Hi,
         I want to know is there any setting such that , for mfg. a finish good material, some qty. of raw material is scrap   the qty which is scrap i have add as negative qty in BOM and but after making the GR for Finish material , all positive qty. are consume by deduction of qty which i have mention as negative but scrap is not done automatically, i am doing scrap sepearetely so it is possible whenevr i make the GR for finish good material then , the material for which i have maiatain as negative should get automatically scrap, as the raw maetria are consum using 543 materials,
second thing the negative qty of material i have mention in BOM of finish good but insted of maiatining -ve qty in BOM is it possible   to add the excess qty in PO as -Ve qty because when we select the finish material in Subcontract PO all BOM components appear in PO   but there there is no option to add some addition material in PO.
can we make the above settings
regards,
    zafar

Hi,
Thanks for your reply.
Just want to know one more think, as in subcontract we are issue the material as per BOm, as suppose, total qty of one raw material required is 4500, which is to be consume for making the finish good but due to std. packing of raw material i want to issue the qty 5000, but while making the GR only 4500 should be consume and the reamining 500 should be shown as in vendor stock after getting material back we will take that as 542 movement.
regards,
    zafar

Reconcilliation of the Scrap w.r.t challan in case of subcontracting.

Dear All,
My client is having the requirement is to do the reconcilliation of the scrap qty , which got generated at the vedor's end w.r.t subcontracting challan
,As per the Indian Excise Law , total weight of the material(raw material) going outside for the subcontracting has to
come back of same weight (finished good /raw material itself )only within 180 days, if it has not come back , then company has to reverse the cenvat credit taken.
Now in our scenario ,suppose Purchase order created of 80KG and in the BOM, raw material is mentioned as 100KG in the +ve qty and 20KG as the -ve qty as the By product, Now during the 541 , qty sent is of 100KGbut Finished good recieved is of 80 kg as per PO qty , and corresponding reconcilliation is being done and after this , system is allowing to compelete the subcontracting challan,but at the same time by product which was given in the -ve qty , has not come back.
So as per the Excise Law total weight has not come back on the challan ,so system should not allow to compelete the challan. and accordingly Cenvat Credit has to be reversed.
Please suggest the way out , how the receiving of Scrap can be done against the subcontracting challan and reconcillaiton
Client is not agreed to receive the material by movement type 542 , which has no linkage with the subcontracting challan.
Regards
Nitin

not answered

Subcontracting challan issue for end product with scrap.

Hi All,
I have one issue let me know how the system act in case of subcontracting challan process,
In our company we use one component and received two end product( one is final product and other one is scrap product)
My problem is how to treat this scrap in challan process.
Pl help me out.
Regards,
Zafina

Hi, Please use the exit to define how you want the system to consider Scrap in the subcontracting process.
Refer below exit for your problem,
1084323 USER-EXIT to update challan status if scrap is calculated
1103537 Correction to note 1084323 for ECC 6.0 Release
Please note the user exit will be accessed only if you were to write a code for it and you assigned/made 545 O as relevant to subcontracting
subcontracting scrap will work if the scrap percentage is defined for the component which is sent to the job worker. If you have a completely new material for scrap then this is not going to work as the system will never be able to assign the qty (mismatch of material code between the scrap material & the challan material).

Subcontracting scrap.?

hii
In subcontracting process, how to handle scrap.
In my case , i know this much is expected after production in subcontractor place.
In what method i can do it in SAP.
Send me the step by step procedure with transaction code and explain me what movement type it'll hit while doing Gr from Subcontractor (For finished goods and scrap).
Thanks

Hi
In Tcode CS01
Enter the finished product and maintain the components.
Add one line item as scrap ( depeding on your business process ) maintain the qty as negative.
Scrap can be any material type. ( check with business whether scrap can be re used for some other purpose)
Then Save.
Regards,
Raman

Subcontracting Byproducts/Scraps

Handling of byproducts and scrpas in Subcontraction process?
Is there any special movement types handling the above materials?
Do they have to reflected in the BOM also?
Regards,
Kapil
Edited by: Kapil Joshi on Dec 31, 2007 4:55 PM

Hi
If you want to get By product or Scrap from SC-Vendor.....you have to maintain while creating BOM itself...
For eg) you give Product "A" to SC Vendor and getting back Product "B"...and By product "C"....
Then Create BOM for Product "B" in CS01...and in Components list...you give Product "A" , and maintain Product "C" as a negative component(ie) By product..)
Then Create PO for Product "B" in ME21N with Item Category "L"....
Then Issue Product"A" to SC-Vendor in ME2O///
After completion of product "B"....you do GR for Product "B"...in MIGO 101+ movement type....
At this time, the Component, Product"A"...will be automatically consumed in 543 O-- movement type...and your By Product will be generated in 545 O+ movement type and it will be lying at SC-vendor's Place....
Then separately, you can Get back this By product in to Company's stock in MB1B movement type....useing movement type 542....
If the By product generation is higher or lesser...you can do subsequent Adjustment Option....
Reward if useful
Regards
S.Baskaran

Scrap in Subcontracting

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