Since you are reporting the cost of the materials and the cutting at the time of the order, you do not need to do anything with the scrap. The only thing that is missing is the revenue offset from the purchaser, but since the items are scrapped and not actually sold, this is correct. If you cannot re-use the titanium after you have made the mistake, it is scrap waste and should not be held in inventory. However, if you are able to recycle the titanium in any way, you do need to report that income.
@blade4sell
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