The quick answer
On a routed WIP work order, choose Enter Completion, set the Ending Operation to the last operation, enter the good units as the Completed Quantity and the spoiled units as Scrap Quantity, then save. The GL Impact subtab shows Work in Process credited for the whole run, with the good units debited to finished goods inventory and the scrapped units debited to a scrap expense account. On the work order, Built counts the good units and Quantity Scrapped counts the scrap.
The screenshots show sample data. Person and company names are fictional. Use your own work order, routing and quantities when following the steps.
Before you start
In this example, Alex Morgan at Example Supply Co. makes TR-410 Trail Daypack at Ogden Plant on WIP work order WO-5120, which is Released for 20 units. The assembly has a routing, TR-410 Sew and Pack, with two operations: 10 Cut and Sew and 20 Pack and Inspect. The 20 packs end up as 18 good and 2 scrap.
The example assumes:
- Work Orders, WIP and Manufacturing Routing are enabled, the posting period is open, and the work order is a WIP work order.
- The account's Average Cost Completion Unit Cost preference is set to Open WIP Amount, so the open Work in Process balance is shared across the good and scrapped units. With the Average Cost setting, units are valued at the assembly's average cost instead, and the postings may not add up to what was issued.
- The assembly item has a Scrap Account, an expense account. Manufacturing Preferences supplies the default for new items.
- Operation 20 is the last operation on the routing. Scrap Quantity is available only when the Ending Operation is the last one.
- The amounts are for this example. They depend on component costs, the costing method, yields and any manufacturing charges, so yours will differ.
- Your costing can add more lines. Labor, machine and overhead amounts from the routing and work centers post as separate lines, and the figures here don't include them. If the finished assembly or the location needs lot, serial or bin detail, the completion also needs Inventory Detail, and a component issue can need it too.
01. Open the work order
Open WO-5120. The status is Released, WIP is checked, Built is 0, Quantity Scrapped is 0 and Quantity is 20. The Issue Components and Enter Completion buttons only appear on a WIP work order.
02. Issue the components
Click Issue Components. The Components tab lists TR-410 Shell Kit and TR-410 Hardware Kit at 20 each. Click Save. Work Order Issue WOI-5121 is created.
Open the GL Impact subtab on WOI-5121. Work in Process is debited $628.00 for the shell kits and $347.00 for the hardware kits, and Raw Components inventory is credited for the same amounts. That is $975.00 in Work in Process, which is the cost the completion has to clear.
Go back to WO-5120 with the Created From link. The status is now In Process, Related Records lists WOI-5121, and Built and Quantity Scrapped are still 0.
03. Enter the completion with scrap
Click Enter Completion. In Operation Completion, choose 10 - Cut and Sew as the Starting Operation and 20 - Pack and Inspect as the Ending Operation. Type 18 in Completed Quantity. Leave Backflush cleared, because you already issued the components. Backflush works out component consumption again and could issue them a second time. Quantity to Build fills in as 18; you can't edit it.
Because operation 20 is the last operation, Scrap Quantity is now available. Type 2. These 2 units are in addition to the 18 good ones, so the completion accounts for all 20.
04. Save and read the GL Impact
Click Save. Work Order Completion WOC-5122 is created. Open its GL Impact subtab.
Work in Process is credited twice. $877.50 goes to Finished Goods for the 18 good units, and $97.50 goes to Production Scrap, a Cost of Goods Sold account, for the 2 scrapped units. Together they equal the $975.00 issued, so nothing is left in Work in Process for this order. Good and scrapped units carry the same cost per unit.
05. Check the work order
Open WO-5120 again. Built is 18, Quantity Scrapped is 2 and Quantity is 20. The status is still In Process in this example, because completing and closing a work order are separate steps and the status depends on your account and transactions. Related Records lists the issue and the completion. Work Order Close reconciles any Work in Process left on the order and can post a production variance, so check what remains before you close it.
Check the result
- WOI-5121 moved $975.00 into Work in Process.
- WOC-5122 recorded 18 good units and 2 scrapped units through operation 20.
- GL Impact shows $877.50 to Finished Goods and $97.50 to Production Scrap, both credited to Work in Process.
- WO-5120 shows Built 18 and Quantity Scrapped 2 against a quantity of 20.
Common questions
How do I record scrap on a WIP work order completion in NetSuite?
Choose Enter Completion on the work order, set the Ending Operation to the last operation on the routing, enter the good units as the Completed Quantity and the spoiled units as Scrap Quantity, and save. The scrap posts to the item's scrap expense account instead of finished goods inventory.
Why is Scrap Quantity grayed out on my Work Order Completion?
Scrap Quantity is available when the Ending Operation is the last operation on the routing, so pick the last operation. If it is still unavailable, check that the work order is a WIP work order with a routing, that the routing's last operation is the one you chose, and that your role and form show the field. If you use Advanced Manufacturing, its location scrap settings can also change how scrap is recorded.
Is scrap part of the quantity to build, or on top of it?
On top of it. Quantity to Build is the good quantity received into inventory. A completion of 18 good and 2 scrap accounts for 20 units, and the work order's Built goes up by 18 only.
Which account does the scrapped output post to?
It posts to the Scrap Account on the assembly item, which is an expense account. Your company may classify it under Cost of Goods Sold or elsewhere. Manufacturing Preferences supplies the default when an item is set up, so changing the preference later doesn't change an item that already has its own Scrap Account.
How does NetSuite split Work in Process between good units and scrap?
It depends on the Average Cost Completion Unit Cost preference. With Open WIP Amount, the open Work in Process balance is shared across the good and scrapped units: $975.00 divided by 20 is $48.75 a unit, so 18 units are $877.50 and 2 units are $97.50. With Average Cost, good and scrapped units are valued at the assembly's average cost, so the postings may not equal the amount issued and a difference can remain to reconcile. The open balance can also include labor and machine cost when the routing carries it.
Why is Quantity Scrapped still 0 after I entered scrap?
This applies if you use Advanced Manufacturing scrap records, where the location's scrap handling matters. Post As Scrap posts the scrap through the completion. Post As Built and Move treats the units as built and moves them to a scrap bin, so Built goes up and Quantity Scrapped can stay at zero. Do Not Post keeps the scrap record for analysis without posting a scrap completion. A completion you enter by hand with a Scrap Quantity depends on your account's setup, so check the location setting.
Does recording scrap close the work order?
No. Completing and closing are separate. In this example the work order stays In Process even though all 20 units are accounted for, but the status depends on your account and transactions. Work Order Close reconciles any residual Work in Process and can post a production variance, so check the remaining balance before you close.