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I have a question about how replacement parts are correctly charged to a work order when they are being sent out for rebuild. Here’s an example of what we want to do, we simply are not sure what transactions to use to accomplish this…

1. An item is signed out of MRO stock (SAP-MM) for a work order (SAP-PM), example a $10K pump.

2. The work order is automatically charged for the replacement cost of the pump $10K

3. The pump removed from service is sent out to a vendor for repair which only cost $2,500.00.

4. Therefore the original work order should be credited the $10K, and only charged $2,500.00 for the cost of the rebuild, thus keeping the R&R budgets accurate for a specific manufacturing area. (if the pump removed from service was not repairable, then the $10K would be the accurate cost of replacing)

Does anyone know the procedure for accomplishing this? I have to believe there are transactions in the MM side that would accomplish this task; we are just not having any success finding them. Any advice would be appreciated, or is this the correct approach at all?

Thanks Much

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Wild Willy
Are you using refurbushment order for the replacement? Because that is the standard way of doing that.
Step 1. Work Order - Dismantle the failed part / install the new one. Put the dismantled on ein the repair stock.
Step 2. Repair the failed one with refurbishment order.

You need split valuation in order to have the refurbishment order to be done.
We are using either a PM01 or a PM02 work order when the bad part is removed from service and replaced with a new or rebuilt one from stock. The SAP-MM side of our stock room automatically charges the work order for the price of the new unit when the part is signed out of stock against the work order. We have been attempting to credit the work order for the full purchase price of the item, so the work order can be charged the actual cost of a vendor rebuild which is much less. We are OK handling the in-house rebuilds done by our maintenance associates. The problem occurs when we receive the item back from the vendor repair, how do we charge the work order for the actual repair cost (instead of the purchase price of new) at that point? I'm not sure how the refurbishment work order would work for that. Any info would be appreciated.
Extending on what you are doing now you simply just have to return the item to be repaired to the store. I would suggest returning it to a storage location which indicates it is awaiting repair. This will credit the work order back with the price of the new unit. Then any purchase orders created for repairing the unit would be given an account assignment directing costs to the work order. When the item is returned from repair it is transfered to the storage location which indicates it is now available for use. Receipt of the item will post the cost of the repair to the work order.

The other option is to adopt the SAP Refurbishment process which I will not attempt to explain here except to say that the work order would be charged with the value of the item used from the store and the repair of the returned part would be against a separate Refurbishment order. Material valuations would be split to indicate whether parts held in store are valued at the new price, cost of repair or a value given to an item awaiting repair.
Wild Willy,

Long term I agree you will find the Refurbishment Order the way to go but this can take some time to implement. It will probably change the way stores stock is valued and to do this often requires some discussions with bean counters and managers so as all understand and are prepared for the effects of the probable revaluation of stocks.

In the short term as I stated before all you need to do is ensure the account assignment on the purchase requisitions/orders for the repairs are directed to the correct work order.

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