Within the Bill of Material Module you will see a Setup Scrap check box and a Standard Build field.  If you wish for the setup scrap qty’s to be included in the Kitting and MRP calculations,  Standard Cost Adjustments, etc. . . you need to make sure that the BOM has the Setup Scrp box marked.  Then upon checking this box the system will default in the Standard Build qty to 1 (just because it can not be blank)  It is recommend that you change the Standard Build qty to the desired average build qty for the product (the Standard Build will affect how the system will calculate Standard Cost Adjustments, etc. . . within the system)