Required One of the products manufactured by the company passes through Required: One of the…

Required One of the products manufactured by the company passes through

Required:

One of the products manufactured by the company passes through two separate processes. In each process losses, arising from rejected material, occur. In Process 1, normal losses are 20 per cent of input. In Process 2, normal losses are 10 per cent of input. The losses arise at the end of each of the processes. Reject material can be sold. Process 1 reject material can be sold for £1.20 per kilo, and Process 2 reject material for £1.42 per kilo. Information for a period is as follows:

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Process 1:

Material input 9000 kilos, cost £14 964.

Direct labour £12 250.

Production overhead £2 450

Material output 7300 kilos.

Process 2:

Material input 7300 kilos.

Direct labour £5000.

Production overhead £1300.

Material output 4700 kilos.

At the end of the period 2000 kilos of material were incomplete in Process 2. These were 50 per cent complete as regards direct labour and production overhead. There was no opening work-in-process in either process, and no closing work-in-process in Process 1.

Required:

Prepare the relevant cost accounts for the period.

Required One of the products manufactured by the company passes through

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