Intermediate: Losses in process and weighted averages method ABC pic operates an integrated cost accounting system and has a financial year which ends on 30 September. It operates in a processing industry in which a single product is produced by passing inputs through two sequential processes. A normal loss of 10% of input is expected in each process.

The following account balances have been extracted from its ledger at 31 August:

ABC pic uses the weighted average method of accounting for work in process.
During September the following transactions occurred:

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Debit Credit () () Process 1 (Materials 4400; Conversion costs 3744) 8144 Process 2 (Process 1 4431; 9681 Conversion costs 5250) Abnormal loss 1400 Abnormal gain 300 Overhead control account Sales Cost of sales 250 585 000 442 500 Finished goods stock 65 000