Question
5. A product is obtained after passing through 3 distinct processes P1, P2 and P3. From the following info relating to the year ending March
5. A product is obtained after passing through 3 distinct processes P1, P2 and P3. From the following info relating to the year ending March 2020, prepare relevant process accounts by identifying normal and abnormal process losses.
5,000 kgs of direct material were introduced at the rate of $5 per unit in the first process (P1).
Particulars | P1 | P2 | P3 |
Other Direct Materials consumed $ | 18,000 | 20,000 | 22,000 |
Direct Labor $ | 15,000 | 18,000 | 20,000 |
Overheads on Direct labor | 100% | 90% | 80% |
Other relevant information are:
Process | Production / Process Output (units) | Normal loss % | Scarp value (per unit $) |
P1 | 4,000 | 20% | 1.8 |
P2 | 3,400 | 15% | 1.5 |
P3 | 3,000 | 10% | 1.2 |
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