The Harare Metal Alloy Company manufactures two products which involve three processes. They pass through processes 1 and 2 as a single product and separate into product X and product Y in process 3. 

The following information has been extracted from the cost records.

The closing stock of work in progress in process 2 is complete as to 100% materials and 75% labour.

Required 

(a) Prepare the ledger account for process 1. 

(b) Prepare the ledger account for process 2.

The completed units in process 2 are transferred to process 3 where they separate into joint products, X and Y. 70% of the finished units are X and 30% are Y. The costs in process 3 are as follows.

10% of the production in process 3 was spoiled.

(c) Prepare the ledger account for process 3.

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Materials per unit Cost of material per litre Cost of materials used in process 1 Cost of materials used in process 2 Direct labour hours per unit Hourly labour cost Variable overhead per unit Fixed overhead absorption rate Sale of by-product Opening stock of work in progress Closing stock of work in progress Process 1 Process 2 4.5 kg 7 kg $1.50 $2 $42 000 to be calculated 3.5 $8 $6 $16 per direct $15 per direct labour hour labour hour च $30 per direct labour hour $1.000 nil nil $29 per direct labour hour nil 1000 units