7. A product is obtained after passing it through three processes. The following information is collected for August, 2020: Process A, Process B and Process C .Materials 5200, 3960, 5924 Wages 4000 ,6000, 8000 Output in units during the month 950 ,840 ,750 Normal loss 5% ,10% ,15% Value of scrap per unit 4, 8 , 10 Additional information are given below: 1,000 units @ Rs. 6 each were introduced in Process A. There was no stock of materials or WIP at the beginning or at the end of that month. The production overhead was RS 18.000 for that month. Prepare the necessary process accounts indicating normal loss, abnormal loss and abnormal gain.

To prepare the necessary process accounts for Process A, B, and C, we will follow the steps and calculations as per the given data and additional information.

### Process A

**Inputs and Losses:**

- Materials: 5200

- Wages: 4000

- Units introduced: 1000 units @ Rs. 6 each

**Calculation of Total Cost:**

- Cost of materials: Rs. 5200

- Cost of wages: Rs. 4000

- Cost of units introduced: 1000 units × Rs. 6 = Rs. 6000

- Total cost incurred in Process A = Rs. 5200 + Rs. 4000 + Rs. 6000 = Rs. 15200

**Output:**

- Output during the month: 950 units

**Losses:**

- Normal loss: 5% of input = 5% of 1000 units = 50 units

**Scrap Value:**

- Scrap value per unit: Rs. 4

**Accounting for Process A:**

| Process A Account | Amount (Rs.) |

|--------------------|--------------|

| Materials | 5200 |

| Wages | 4000 |

| Units introduced | 6000 |

| Total Cost | 15200 |

| Output | 950 units |

| Scrap (950 units × Rs. 4) | 3800 |

| Normal Loss (50 units × Rs. 6) | 300 |

| Total Output (950 - 50) | 900 units |

| Cost per unit (15200 / 900) | 16.89 |

### Process B

**Inputs and Losses:**

- Materials: 3960

- Wages: 6000

**Calculation of Total Cost:**

- Total cost incurred in Process B = Rs. 3960 + Rs. 6000 = Rs. 9960

**Output:**

- Output during the month: 840 units

**Losses:**

- Normal loss: 10% of input = 10% of 900 units (output from Process A) = 84 units

**Scrap Value:**

- Scrap value per unit: Rs. 8

**Accounting for Process B:**

| Process B Account | Amount (Rs.) |

|--------------------|--------------|

| Materials | 3960 |

| Wages | 6000 |

| Total Cost | 9960 |

| Input from A | 900 units |

| Output | 840 units |

| Scrap (840 units × Rs. 8) | 6720 |

| Normal Loss (84 units × Rs. 16.89) | 1415.76 |

| Total Output (840 - 84) | 756 units |

| Cost per unit (9960 / 756) | 13.17 |

### Process C

**Inputs and Losses:**

- Materials: 5924

- Wages: 8000

**Calculation of Total Cost:**

- Total cost incurred in Process C = Rs. 5924 + Rs. 8000 = Rs. 13924

**Output:**

- Output during the month: 750 units

**Losses:**

- Normal loss: 15% of input = 15% of 756 units (output from Process B) = 113.4 units

**Scrap Value:**

- Scrap value per unit: Rs. 10

**Accounting for Process C:**

| Process C Account | Amount (Rs.) |

|--------------------|--------------|

| Materials | 5924 |

| Wages | 8000 |

| Total Cost | 13924 |

| Input from B | 756 units |

| Output | 750 units |

| Scrap (750 units × Rs. 10) | 7500 |

| Normal Loss (114 units × Rs. 13.17) | 1502.38 |

| Total Output (750 - 114) | 636 units |

| Cost per unit (13924 / 636) | 21.89 |

### Summary

This completes the preparation of the process accounts for Process A, B, and C, considering normal losses and scrap values as per the provided data. These accounts show the cost per unit and the disposition of scrap and normal losses for each process.