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A company produces a single product that passes through two processes. The details for process 1 are as follows:
A company produces a single product that passes through two processes. The details for process 1 are as follows:
Materials input 20,000 kg at $2·50 per kg
Direct labour $15,000
Production overheads 150% of direct labour
Normal losses are 15% of input in process 1 and without further processing any losses can be sold as scrap for $1 per kg.
The output for the period was 18,500 kg from process 1. There was no work-in-progress at the beginning or end of the period.
What value (to the nearest $) will be credited to the process 1 account in respect of the normal loss?
