A product passes through three processes a, b and c
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.