Decommissioned ships of the US Navy are typically held in reserve, not so much as a reserve, but until the decision is made as to what their final disposition will be. The primary fate of most is to face the breakers yard, to be dismantled, and recycled.
The other fate is SINKEX. Live fire training is as important afloat as it is ashore. And while some relatively low cost targets can be built with barges and shipping containers, there’s nothing like shooting at real ships.
Here’s two examples of SINKEX, both from RIMPAC 2008.
Take note that it takes quite a few bombs to sink a ship. As the saying goes, you don’t sink ships by punching holes in them above the waterline. But then again, nor do the ships have aboard any of the highly flammable items aboard that a working warship would.