b) The costs of the process are as follows for Thuto Ltd:

Process 1

P

Direct materials 3 000

Direct labour 500

Direct expenses 1 000

Production overhead 500

The input quantity was 250 kg and the expected or normal loss was 10 per cent of input. Actual output was 225 kg.

Required:

1. Define process costing (2 marks)
2. Explain the meaning of normal loss (2 marks)
3. Prepare the process account (8 marks)