Questions:
A product passes through three processes A, B and C. The details of expenses incurred on the three processes during the year 1992 are as follows:
|
Process A
|
Process B
|
Process C
|
|
Units issued/introduced at cost per unit Rs 100
|
10000
|
|
|
|
(Rs)
|
(Rs)
|
(Rs)
|
|
Sundry materials
|
10000
|
15,000
|
5,000
|
|
Labour
|
30000
|
80000
|
65,000
|
|
Direct expenses
|
6,000
|
18,150
|
27,200
|
|
Selling price per unit of output
|
120
|
165
|
250
|
Management expenses during the year were Rs 80,000 and selling expenses were Rs 50,000. These are not allocable to the processes. The actual outputs of processes A, B and C were 9,300 units; 5,400 units; and 2,100 units, respectively. Two-thirds of the output of process A and one half of the output of process B were passed on to the next process and the balance was sold. The entire output of process C was sold. The normal losses of the three processes, calculated on the inputs of processes, were as follows: process A-5%, process B-15% and process C-20%. The loss of units in process A was sold at Rs 2 per unit, that of B at Rs 5 per unit and that of process C at Rs 10 per unit. Prepare process accounts and profit and loss accounts.