A firm has two processes 1 and 2.

Material for 12,000 items was put into Process 1. There were no opening stocks and no process losses and there were transfers of 9,000 items to Process 2. The unfinished items were complete as to material and 50% complete as to labour and overhead. The costs of Process 1 were Direct Material £36,000, Direct Labour £32,000 and Overheads £8,000.

Process 2 completed 7,600 items and there were 600 scrapped which was considered normal. The balance was unfinished and deemed to be 25% complete in labour and overheads. The costs for Process 2 were; Labour £28,500 and Overheads £14,000. You are required to prepare process accounts for each process.