Question

A product passes through three processes A, B and C. The
normal wastage of each process is as follows: Process A - 3%, Process B - 5% and Process C - 8%. Wastage of Process A was sold at Rs. 0.25 per unit, of Process B at Rs. 0.50 per unit, and that of Process C at Rs. 1 per unit. 10,000 units were issued to
Process A in the beginning of October 2017 at the cost of R. 1 per unit. The other expenses were as follows:

	Process A(Rs.)	Process B(Rs.)	Process C(Rs.)
Sundry materials	1,000	1,500	500
Labour	5,000	8,000	6,500
Direct expenses	1,050	1,188	2009
Actual output	9,500 units	9,100 units	8,100 unit

Prepare the Process Accounts, assuming that there were no opening or  closing stocks. Also give the Abnormal Wastage and Abnormal Gain Accounts.

Answer 1

Books of..............

Dr.

Process A Account

Cr.

Particulars	Quantity (Units)	Amount (Rs.)	Particulars	Quantity (Units)	Amount (Rs.)
To Units Introduced	10,000	10,000	By Normal Loss`(10,000  "Units"xx3/100)-(300  "Units"xxRs. 0.25)`	300	75
To Sundry Materials	-	l,000	By Abnormal Loss A/c	200	350
To Labour	-	5,000	By Process B A/c	9,500	16,625
To Direct Expenses	-	1,050
	10,000	17,050		10,000	17,050

Dr.

Process B Account

Cr.

Particulars	Quantity (Units)	Amount (Rs.)	Particulars	Quantity (Units)	Amount (Rs.)
To Process A A/c	9,500	16,625	By Normal Loss`(9,500  "Units"xx5/100)-(475  "Units"xxRs. 0.50)`	475	238
To Sundry Materials	-	1,500
To Labour	-	8,000	By Process C A/c	9,100	27,300
To Direct Expenses	-	1,188
To Abnormal Gain A/c	75	225
	9,575	27,538		9,575	27,538

Dr.

Process C Account

Cr.

Particulars	Quantity (Units)	Amount (Rs.)	Particulars	Quantity (Units)	Amount (Rs.)
To Process B A/c	9,100	27,300	By Normal Loss`(9,100  "Units"xx8/100)-(728  "Units"xx Rs. 1)`	728	728
To Sundry Materials	-	500	By Abnormal Loss A/c	272	1,156
To Labour	-	6,500	By Finished Stock A/c	8,100	34,425
To Direct Expenses	-	2,009
	9,100	36,309		9,100	36,309

Dr.

Abnormal Loss Alc

Cr.

Particulars	Quantity (Units)	Amount (Rs.)	Particulars	Quantity (Units)	Amount (Rs.)
To Process A Alc	200	350	By Bank Alc(Sale of Scrap)
To Process C Alc	272	1,156	Process A	200	50
			Process C	272	272
			By Costing P and L Alc (Balancing Figure)	-	1,184
	472	1,506		472	1,506

Dr.

Abnormal Gain Alc

Cr.

Particulars	Quantity (Units)	Amount (Rs.)	Particulars	Quantity (Units)	Amount (Rs.)
To Normal Loss A/c	75	38	By Process B A/c	75	225
To Costing P and L A/c -(Balancing Figure)	-	187
	75	225		75	225