Most of the time I recommend against using Scales not because they don't work but because most people don't understand how they work. If you create a scale, the text or numbers you enter as values are actually text strings, not values. So if you create a scale of "1, 2, 3", that is no different than a scale of "cat, dog, bird". In addition, how those values will be calculated towards the course total is dependent on the aggregation type you are using. If you are fine with testing this first in your own Moodle instance, then by all means move forward and follow instructions below.
- Create your scale. I won't show you how to do that but rather point you to the documentation. Again, I highly recommend you check out those last two sections to see example scales and how they work with various aggregations.
- Create assignment or grade item if not already done so.
- Set the created scale as the grading method/type.
- Go into your gradebook and select Categories and Items tab.
- Select Edit icon next to assignment/grade item. Since you already set the grade method/type to a certain scale, the minimum and maximum grade will be autopopulated with what is the min and max real scores i.e. if you had a 13 different values in your scale, depending on your aggregation type, the min and max would be 1-13 or 0-12.
- In the Grade to pass field, enter the real score that corresponds to the value in the scale that you want to be the lowest passing grade. E.g. you scale is "Bad, Below Average, Average, Good, Great". If the min and max shows as 1-5 and you want "Average" to be passing, you would enter a 3 into the Grade to pass field because "Average" is the third value.
- Save your changes.
- Grades should then appear as red or green in that column depending if they reached the grade to pass.
Happy 
oodling!