PROCESS COSTING SUMS

1. Prepare a process accounts and calculate total cost of production from the data given
below:

Process X Process Y Process Z

Materials 2,250 750 300
Labour 1,200 3,000 900
Direct Expense :
Fuel 300 200 400
Carriage 200 300 100
Works O/H 1,890 2,580 1,875
The indirect expenses Rs.1,275 should be apportioned on the basis of wages.

2. The following information is given in respect of process A

Material 1000 kgs at Rs.6per Kg
Labour Rs. 5000
Direct expenses Rs. 1000
Indirect expenses allocated to Process A Rs. 1,000. Normal wastage 10% of input.
Prepare Process A Account when
a. Scrap value of normal loss is nil.
b. Scarp arising out of normal has a sale value of Rs.1 per unit.

3. Fifty units are introduced into a process at a cost of rupee one each. The total additional
expenditure incurred in the Process is Rs 30. Of the units introduced, 10% are normally
spoiled in the course of manufacture, these possess a scarp value of Rs.0.25 each. Owing
to an accident only 40 units are produced. You are required to prepare process account
and abnormal loss a/c.

4. A product passes through three processes A, B, & 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 25 paisa per unit that of Process B at 50 Paisa per unit and of Process C is Rs 1 per
unit.
10,000 units were issued to Process A on 1/4/2015 at a cost of Rs 1 per unit. The other
were as follows:
 Particulars Process A Process B Process C

Sundry materials 1,000 1,500 500

Labour 5,000 8,000 6,500
Direct expenses 1,050 1,188 2,009
Actual output 9,500 Units 9,100 Units 8,100 Units

Prepare the process accounts, assuming that there were no openings or closing stocks also give
all the necessary accounts.

5. Product B is obtained after it passes through three distinct process. The following
information obtained from the accounts for the week ending 31st October, 2008

Total Process
(Rs) I II III
Direct material 7,542 2,600 1,980 2,962
Direct wages 9,000 2,000 3,000 4,000
Production O/H 9,000
1,000 units at Rs.3 each were introduced to Process I. There was no stock of material
or work-in-progress at the beginning or at the end of period. The output of each process
passes direct to the next process and finally to finished stock. Production overhead on
100% of direct wages. The following additional data are obtained:

Output during % of normal loss to Value of scrap per

the week input unit
Process I 950 5% 2
Process II 840 10% 4
Process III 750 15% 5
Prepare process cost accounts and abnormal gain and loss account and normal loss a/c.

6. A product passes through three processes, A B and C 10,000 units at a cost of Rs1 were
issued to process A. the other direct expenses were:

Particulars Process A Process B Process C

Sundry materials 1,000 1,500 1,480

Direct labour 5,000 8,000 6,500
Direct expenses 1,050 1,188 1,605

The wastage of process A was 5% and process B 4%. The wastage of process A was sold
at Rs 0.25 per unit, the of B at Rs 0.50 per unit and that of Cat Rs 1.00 per unit. The
 overhead charges were 168% of direct labour. The final product was sold at Rs 10.00 per
unit, fetching a profit of 20% on sales. Find the percentage of wastage in process C.

7. The product of a manufacturing concern passes through three processes. In March 2020,
the cost of production was given below:

Process A Process B Process C

Raw materials used (Tons) 200 71 164

Rs. Rs. Rs.

Cost per ton 100 300 50

Direct wages 8000 3490 2850

Overheads 2520 2400 3820

Sales of scrap per ton 80 60 120

The product of the three process is dealt with as follows:

Sent to warehouse for sale 25% 50% 100%

Sent to next process 75% 50% -

In each process, 6% of total weight is lost and 8% is scrap. Prepare process accounts.

8. VXL Chemicals ltd processes a patent material used in buildings. The materials is
produced in three consecutive grade- soft, medium, and hard.

Particulars Process I Process II Process III

Raw materials used 1,000 tons
Cost per ton Rs. 200
Manufacturing wages and expenses 87,500 39,500 10,710
Weight lost (% of input of the process) 5% tons 10% 20%
Scrap (sale price Rs.50 per ton) 50 tons 30 tones 51 tons
 Sale price per tone 350 500 800

Management expenses were Rs 17,500 and selling expenses Rs 10,000. Two third of the
output of process I and one half of the output of Process II are passed on the next process
and the balances are sold. The entire output of Process III is sold. Prepare the three
process accounts and a statement of profit. Make approximations, where necessary.