A product is manufactured by passing through three processes: A, B and C. In process C a by-product is also produced which is then transferred to process D where it is completed. For the first week in October, actual data included:
|
|
Process
A
|
Process
B
|
Process
C
|
Process
D
|
|
Normal loss of input (%)
|
5
|
10
|
5
|
10
|
|
Scrap value ($ per unit)
|
1.50
|
2.00
|
4.00
|
2.00
|
|
Estimated sales value of by-product ($ per unit)
|
-
|
-
|
8.00
|
-
|
|
Output (units)
|
5,760
|
5,100
|
4,370
|
-
|
|
Output of by-product (units)
|
-
|
-
|
510
|
450
|
|
|
|
|
|
|
|
|
$
|
$
|
$
|
$
|
|
Direct materials (6,000 units)
|
12,000
|
|
|
|
|
Direct materials added in process
|
5,000
|
9,000
|
4,000
|
220
|
|
Direct wages
|
4,000
|
6,000
|
2,000
|
200
|
|
Direct expenses
|
800
|
1,680
|
2,260
|
151
|
You are required to prepare:
(a) Accounts for process A, B, C and D
(b) Abnormal loss account and abnormal gain account
Note: Assume that overheads are to be absorbed using the direct wages percentage method.