[ADD] Inventory: Account for scrapped goods

closes odoo/documentation#15980

Signed-off-by: Erin Jerison (erjer) <erjer@odoo.com>
Co-authored-by: Jess Rogers <104637850+jero-odoo@users.noreply.github.com>
Co-authored-by: Felicia Kuan <feku@odoo.com>

content/applications/inventory_and_mrp/inventory/inventory_valuation.rst

@@ -10,4 +10,5 @@ Inventory valuation
    inventory_valuation/cheat_sheet
    inventory_valuation/landed_costs
    inventory_valuation/valuation_by_lots
+   inventory_valuation/scrapped_inventory_valuation
 

content/applications/inventory_and_mrp/inventory/inventory_valuation/scrapped_inventory_valuation.rst

@@ -0,0 +1,115 @@
+==========================
+Account for scrapped goods
+==========================
+
+It's essential to strike a balance between having sufficient stock on hand to meet demand while
+avoiding overpurchasing. When working with perishable products, or when inventoried goods have
+defects that prevent the product from being sold, occasionally, products must be scrapped and
+removed from inventory. It's important to account for these losses in the :ref:`Profit and Loss
+report <accounting/reporting/profit-and-loss>`.
+
+Generally, follow this process to account for scrapped goods in the *Profit and Loss* report:
+
+#. :ref:`Enable settings in the Inventory configuration
+   <inventory/inventory_valuation/scrap-enable>`.
+#. :ref:`Configure the product category <inventory/inventory_valuation/scrap-category>`.
+#. :ref:`Set up a scrap location and its scrap journal
+   <inventory/inventory_valuation/scrap-location>`.
+#. :ref:`Scrap products <inventory/inventory_valuation/scrap-products>`.
+#. :ref:`View scrapped products in the Profit and Loss report
+   <inventory/inventory_valuation/view-profit-loss>`.
+
+.. _inventory/inventory_valuation/scrap-enable:
+
+Enable settings
+===============
+
+To ensure scrapped goods can be seen in the *Profit and Loss* report, open :menuselection:`Inventory
+app --> Configuration --> Settings`. In the :guilabel:`Warehouse` section, enable :guilabel:`Storage
+Locations`.
+
+.. _inventory/inventory_valuation/scrap-category:
+
+Configure the product category
+==============================
+
+Next, configure the product category. Open :menuselection:`Inventory app --> Configuration -->
+Categories`. Open or create a product category.
+
+Next, set the :guilabel:`Costing Method` to either :guilabel:`First In First Out (FIFO)` or
+:guilabel:`Average Cost (AVCO)`:
+
+- :guilabel:`First In First Out (FIFO)`: Inventory is valued, and the cost of goods sold (COGS) is
+  calculated by assuming the oldest items purchased are the first ones sold, tracking costs by
+  specific receipt lots. It's a precise method for fluctuating costs, and requires tracking units by
+  their entry time (load/serial numbers) for accurate removal from stock.
+- :guilabel:`Average Cost (AVCO)`: Inventory value is calculated by dynamically averaging the cost
+  of all units in stock, updating with each new purchase or manufacturing receipt to reflect
+  fluctuating prices, making it ideal for varied vendor costs, with the system automatically
+  recalculating the unit cost and value for assets and COGS. Odoo handles the math, adjusting the
+  average cost automatically as products are bought or sold, but doesn't change it when products
+  sell, only updating when new stock arrives at a different price.
+
+Next, set the :guilabel:`Inventory Valuation` field to :guilabel:`Perpetual (at invoicing)`. This
+setting ensures that real-time journal entries are created in the *Accounting* app whenever stock
+enters or leaves the company's warehouse.
+
+.. _inventory/inventory_valuation/scrap-location:
+
+Set up a scrap location and its scrap journal
+=============================================
+
+Next, you must create or edit an existing scrap location. Open :menuselection:`Inventory app -->
+Configuration --> Locations`. Open an existing location or create a new one by clicking
+:guilabel:`New`.
+
+.. note::
+    By default, the :guilabel:`Locations` list is filtered to show only internal locations. Remove
+    this filter to view all locations, including *Inventory Loss* locations.
+
+Update the :guilabel:`Location Type` field to select :guilabel:`Inventory Loss`.
+
+Specify a :guilabel:`Loss Account` by selecting the account used for scrapped goods.
+
+.. example::
+    The `WH/Scrap` location is an :guilabel:`Inventory Loss` location that uses the `600001 Scrapped
+    Goods` journal as its :guilabel:`Loss Account`.
+
+    .. image:: scrapped_inventory_valuation/example-scrap-location.png
+       :alt: Specify an Inventory Loss Location Type and a Loss Account.
+
+.. _inventory/inventory_valuation/scrap-products:
+
+Scrap products
+==============
+
+After the product category and location are set up, :doc:`products can be scrapped
+<../warehouses_storage/inventory_management/scrap_inventory>`. Be sure to select the scrap location
+in the :guilabel:`Scrap Location` field.
+
+.. example::
+    `20` units of `Under-Eye Masks` are scrapped to `WH/Scrap`.
+
+    .. image:: scrapped_inventory_valuation/example-scrap-order.png
+       :alt: Specify the Product, Quantity, and Scrap Location.
+
+.. _inventory/inventory_valuation/view-profit-loss:
+
+View scrapped products in the Profit and Loss report
+====================================================
+
+After products have been scrapped to the correct scrap location, view items scrapped to it in the
+Profit and Loss report. Open :menuselection:`Accounting app --> Reporting --> Profit and Loss`. To
+view the scrap order in the report, under the :guilabel:`Gross Profit` section, expand the
+:guilabel:`Expense` category. Search for the scrap journal in the list and click the
+:icon:`fa-ellipsis-v` :guilabel:`(vertical ellipsis)` icon next to the scrap account and select
+:guilabel:`General Ledger`.
+
+.. example::
+    `$100` worth of `Under-Eye Masks` appear as a debit in the Profit and Loss' General Ledger.
+
+    .. image:: scrapped_inventory_valuation/scrapped-profit-loss.png
+       :alt: View the General Ledger to see scrapped items in the Profit and Loss report.
+
+.. seealso::
+   :ref:`Profit and Loss report <accounting/reporting/profit-and-loss>`