Practical Problems d & c Ltd from the following ·

. l d er of Chan o. · ·
1. Prepare relevant accounts lll the e g process I
Process II
f 10,000
~ 13,ooo
Indirect material f 10,000
~ 13,100
Direct labour f 20,000 ~ 10,000
Production overheads 5%
Normal loss (of Input) 5%
f 5
Scrap value per unit 19,000
t5
1a,a00
Output (units)
20,000 units costing ~ 60,000 are introduced in Process I. (B. Com. Delhi)
(Ans. Cost per unit - Process I , 5, Process II t 7).
2. An article undergoes three processes.
. From the following
. information,
h f show the cost of each process
of manufacture and cost per article produced dunng the mont o January 2018.
Process A Process B Process c
t f ~
37,500 12,500 5,000
Materials consumed
v--· - - - - - - - - - -- - - - -
Labour 1s ,000
Other direct expenses 20,000 50,000 6,250
The indirect expenses amount 6,500 18,00~ wa es. Articles
produced during the month ed to t 21,250. These are apportioned on the basis of Bh~rathida.san)
. Were 240. (B Com.
(Ans. Cost per article-A t 287 50· B t 67 . .
5
3. From the following informati · 1
, C t 800)
1 000 units at t 40 . on, prepare a process account.
' Labour cost per urut were introduced in Process I :
t 5,000
Material 20,000
Production overhead 3,500 .
The normal process l h t 10 per unit.
. oss as been estimated at 10¾ of the intput which can be sold at Calicut)
Actual production_was 920 units. (B.Com. ,
[Ans. Cost per urut t 75· Abnormal . 20 ·ts ., d a process.
ufacture f , gam urn -, 1,500)
4• In man °
a ~roduct 1,000 kg. of raw materials at t 8 per kg. were supplie to t 1,000.
Other expenses on this process were as follows : Labour cost f 2,000, production expenses t in this
Normal loss has been estimated at 10¾ which could be sold at t 2 per kg. The actual outpu
process was 880 kg. Calculate the value of abnormal loss. .)
(B.Com., Madurai
[Ans. 20 units @ t12 • f 240] f
s. A product passes through two processes A and B d th t o finished stock. TheThnormal
. 301i0 d an en
wastage o
rap of process
h
ea~ process 15 an 5% of the units introduced in each process respectively. e sc
A is sold ~t Re. o_.so per unit and that of process B at Re 1 per unit. es are •
10,000 uruts are introduced to process A at a cost of t 2.00 per unit. The other expens o~ess B
Process A Pr t

Wages
Manufacturing Expenses
'
12,000
2,100
19,000
2,375

Actual Production is : Process A-9,500 units Process B-9,100 units.

Prepare Process Accounts. d
[Ans. Cost per unit Process A t 3.50; B t 61 (BBM. Bangalore, Adapte )
then
6. Ravinder Manufacturing Company's product passes through two distinct processes A and B and
to Finished Stock. It is known from past experience that wastage occurs in the proc~ss as un~er : In
the
Process A. 5% of the units entering the process and in Process B, 100/o of the umts entenng
process. The scrap value of wastage in process A is t 16 per 100 units and in Process B is f 20 per lOO
units. The process figures are :
Process A Process B
Materials consumed t 6,000 t 3,000
Wages 7,000 4,000
Manufacturing expenses 2,000 2,000
5,000 units were brought into Process A, costing t 5,000. The outputs were : Process A - 4,700 units.
Process B - 4,150 units. Prepare Process Accounts showing the cost of the output.
(B. Com. Madras, Delhi)
[Ans. Cost per unit-At 4.20; and B t 6.77; Abnormal loss-A f 210, B f 542)
7. The product of a manufacturing concern passes through two processes A and B and then to finished
stock. It is ascertained that in each process normally 5% of the total weight is lost and 100/o is scrap
which from Process A and B realises t 80 per ton and f 200 per ton respectively.
The following are the figures relating to both the proccesscs :
Process A Process B
Materials in tons 1,000 70
Cost of materials in rupees per ton 125 200
 28,000 ,
10 000
Wages in rupees
. . 8,000 5 25
Manufacturing expenses m rupee ' 0
830
Output in tons t k f 780
Prepare Process Accounts showing cost per ton of each process. There was no ~ oc O Work-in.
progress in any process. (B.Com. S.V. Univ.,· Mysore; Delhi)
[Ana. Cost per ton A t 180, B t 210, Tr. to finished stock 780 tons at 1,63,800] . .
8. The product of a manufacturing company passes through two processes A ~nd ~- It is ascertained that
in each process 10% of the total weight is lost and 20% is scrap. The realisation from scrap amounts
to t 160 per ton and f 400 per ton from process A and B respectively.
The process figures are as follows :
Process A Process B

Materials consumed in tons

Cost per ton
2,000
250
' 140
~

400
Wages 36,000 24,ooo
Manufacturing expenses 12,000 10,000
Prepare process accounts showing the cost per ton of output in each process. (B. Com. Bombay)
[Ans. Transfer to Finished stock 1078 units @ f 418.18 = 4,50,800]
9. The product of a company passes through three distinct processes to completion. From the Past
experience it is ascertained that wastage is incurred in each process as under : Process A 2%; Process
B 5%; Process C 10%.
The wastage of Processes A and B is sold at t 10 per 100 units and that of Proccess C at f 80 per
100 units.
Following is the information regarding the production of March 2004 :
Process A Process B Process c
f f
Materials
Direct Labour
12,000
16,000
8,000
12,000
4,000
6,000
'
Machine expenses 2,000 2,000 3,000
Other factory expenses 3,500 3,800 4,200
20,000 units have been issued to Process A at a cost of t 20,000. The output of each process has been
as under :
Process A 19,500 Units
B 18,800 Units
C 16,000 Units
There was no stock of work-in-progress in any process in the beginning and at the end of March.
Prepare Process Accounts
[Ans. Tr. Process B 19,500 units at~ 53,187; Tr. Process C 18,800 units at~ 80,060;
Transfer to Finished stock 16,000 units at f 90,550].
10. Department A conducts a process which requires mixing of materials and cooking of the mixture in
batches of 1,000 kg each. Cooking results in 10 per cent loss of weight of the mixture. Also, past
experience shows that two batches out of every ten started in the process are spoiled. The production
records for March, 2004 are following :
(a) Production started in the Process : 50 batches of 1,000 kg each.
(b) Production completed and transferred to finished goods : 34,200 kg
(c) There is no inventory of work-in-progress at the beginning or at the end of the month.
Costs recorded during the month totalled t 70,000.
Prepare the Account of the Process conducted by Department A. (B.Com.)
[Ans. Cost per unit t 2; Abnormal loss 800 units @ t 2 = f 1,600;
Tr. to finished stock 34,200 units @ t 2 = f 68,400]
1/
m the following pr
11. fro ' epare Process Accounts :
Materials consumed Process A Process B
l)irect labour t 12,000 6,000
~ 14,000 8,000
Manufacturing expenses
~ 4,000 4,000
input in process A
input in process A (units) 10,000
output
Normal wastage '
(units)
10,000
9,400
5%
8,300
10%
value of nonnal wastage (per 100 units)
~ 8 10
. . (B Com. Madurai)
[Ans. Tr. to F1D1Shed stock A/c 8,300 units at f 56,359] . .
12• The product of a company pass th
A B d es roug
h th • •
ree distinct processes to completion. These processes are
lcnownd as ' an C. From past experience it is ascertained that wastage is incurred in each process
as un er:
Process A 2 per cent· Process B 5 f
. ' per cent and Process C 10 per cent. In each case the percentage o
wastage ~ computed on the number of units entering the process concerned. The scrap value of
wasta~e is:-scrap ?f ~ocess A and B, ~ 5 per 100 units and that of Process C, 20 per 100 units. The
following mfonnation is obtained :
Processes
A B C
r r r
Materials 4,000 2.000 1,000
Direct labour 6,000 4,000 3,000
Manufacturing expenses 1 000 1 000 1 500
20,000 units have been issued to Process A at a cost of t 8,000, The output ~f each pr~cess has been
as under: Process A 19,000 units; Process B 18,000 unit and Process C16,000 units. There is no stock
or work-in-progress in any process.
Show the Process Accounts. (B.Com. BangalOTe)
(Ans. Tr. to Finished Stock 16,000 units @ t 1.86 = t 29,816]
13. The following particulars for the last process are given : n
Units t
Transfer to the last process at cost from the first process 4,000 9.000
Transfer to finished stock from the last process 3,240
Direct Wages 2,000
Direct materials used 3,000
The factory overhead in process is absorbed @ 400% of direct materials. Allowance for normal loss is
20% of units worked. The scrap value is f 5 per unit.
You are required to prepare : (a) Last process account : (b) Nonnal wastage account : (c) Abnormal
effectives account. (B.Com. Meerut)
[Ans. Transfer to finished stocks 3,240 units at f 22,275]
14. A product is finally obtained after it passes through three distinct processes. The following informa-
tion is available from the cost records.
Process I Process 11 Process m Total
r r r r
Materials 2,600 2,000 1,025 5,625
Direct wages 2,250 3,680 1,400 7,330
Production overheads 7,330
500 units @ f 4 per unit were introduced in Process 1. Production overheads are absorbed as a
percentage of direct wages.
 . cesses are given below:
The actual output and normal loss of t he respective pro ll ,,. z if
Output Norma oss as a va ue o scrap
(units) percentage of input (per unit)
Process I 450 lO% ~2
Process II 340 20% ?4
Process ill 270 25% f 5
Prepare the Process accounts and the abnormal gain/loss accounts.
. (B.Com. Bang~lo:e Adapte
[Ans. Tr. to Process II 450 units at f 9,000; to Process III 340 uruts at f 17,000. TL to Frrushed 900:
270 units at f 21,600]
15. A product is obtained after it passes through three distinct processes. You are requited to prep
Process Accounts trom the following information : are
Particulars Process
A B
C
·f f
Materials
Direct wages
7,300
6,750
6,060
8,750
7,900
10,750-
'
Direct expenses 940 840 750
Manufacturing expenses 3,375 4,375 5,375
2,000 units at f 10 per unit were introduced in Process A. Other details are :
Process Actual output Normal loss Value of scrap
per unit
Units f
A 1,880 5% 5.00
B 1,690 10% 10.00
C 1,530 10% 15.00
Also prepare abnormal loss or gain account if it arises in any process.
(B. Com, Bangalore)