There are two primary ways damaged inventory quantities are handled within Furniture Wizard.
Configure a Damaged Branch
It can be used to process returns and exchanges.
You can use inventory reports filtered by branch to attain information about the Inventory.
Utilize the damaged column in the inventory grid.
It can be used to reduce the quantity available in a given branch.
Detailed information is available via Inventory Super Search.
The video below is a short walk-through of the two options to handle a damaged branch, along with other helpful tips.