Can anyone explain the difference(s) between “Return Material” and “Job Receipt to Salvage”?
They appear to have the same functionality (creating material transactions from a job back to stock) and both appear to make corresponding cost adjustments to the job (reducing the material cost applied to the job by the returned/salvaged quantity).
I’m struggling to determine which option should be used in our day-to-day operation.
For example: We issue a 96" bar of steel to a job which requires 60". After the saw operation, we will “return” 36" back to stock.
Would appreciate any insight on what everyone uses in this type of scenario.
We use it in almost all our parts. Issue raw material “A” to Job. It is processed and generates scrap. This scrap can be salvaged and has a part number “B”, which is defined on the BOM and Job as salvage material with a cost. So if we return A if it is excess or any other reason we will use Return material, this is a rare use in our case. But all Jobs invariably have scrap which is salvaged as Part B, which goes into inventory and is sold or further processed as the case may be.
Just to add on here since we conversely use Return Material on 98% of our parts:
We have a selection of standardized subassemblies that we build in bulk to stock and then issue as materials to larger machine jobs. In the event that we need to change that issued subassembly by pulling out a part, we do so with Job Receipt to Salvage against that subassembly’s material line on the larger machine job. It’s one transaction to remove the part’s cost from the job and add the part into inventory with a FIFO record.