A bill of materials — a BOM — is a recipe: the list of components, and how much of each, that one unit of a manufactured product is made from. The BOM's header is the made product; its lines are the components, each with its quantity per unit, its unit of measure, and a scrap allowance — the percentage of that component honestly expected to be lost to cutting, spillage and spoilage, so the recipe plans for the waste the real world insists on.
BOMs live in this chapter because they are catalogue facts — they define what a product is — but their working life is in Manufacturing (Chapter 10): a work order explodes its product's BOM into the materials to issue, and the replenishment worklist (§5.6) answers a manufactured product's shortage with a work order only when an active BOM exists to make from. The costing side lives here too: the BOM Cost Build-up (§6.10) rolls the components' current costs up through every level — a sub-assembly's cost is its own BOM rolled up in turn — to state what one unit of the made product should cost, scrap included. Keep BOMs truthful and two chapters behave; let one drift from the factory floor and both the plan and the cost built on it drift with it.