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Hello sir.. all these question I can’t do it and i hope you can help me.
Q1: A firm manufactures a product in batches of 2500. output is classified as premium quality, standard quality or reject. The following probabilities have been calculated for the outputs:Grade:Premium : has probability of 0.5Standard : has probability of 0.4So how many rejected products are expected from each batch?
Q2: A company is considering a new one year contract which will require three skilled employees. the employees could be recruited for the duration of the contract at a total cost of $90,000. They would require supervision by an existing manager who costs $40,000 per year and it is anticipated that this contract would need 20% of the manager’s time. Another option is that the company could retain existing employees who currently each earn $20,000 per year, at a total training cost of $10,000. The total replacement cost of these employee. If they were used on the new contract. would be $75,000.What is the total relevant labor cost for this contract?
Q3: A company has a margin of safety ratio of 20%. Budget sales in a period are $480,000 and budgeted variable costs are 45% of sale revenue. What are the budget fixed costs?
Q4: A business sell a single product for $85 per unit. Variable costs per unit are $53 and total annual fixed cost are $30,000. The business has a margin of safety of 1,750 units. What is the budgeted annual sales revenue for the business?
Q5: Output and costs in a factory over three periods are summarised below.output(units):Period 1:11640 , Period 2: 12410 , Period 3: 12260cost($), period 1: 336548 , Period 2: 348252 , Period 3: 345942Using high/low method, what are the estimated fixed costs per period?Really sorry teacher for bother you with so many question, and I hope you can help me Thanks you before hand…
I don’t know which mock exam you are looking at, but I am surprised that you have the questions but not the answers!!
Also, not all of these questions are in the syllabus for Paper F2 (some are not asked until F5!!)1. The probability of rejects is 1 – 0.5 – 0.4 = 0.1.
Therefore the expected rejects are 0.1 x 2500 = 2502. The supervisor cost is not relevant because he is a fixed cost.
The choice is either recruiting and spending 90,000, or using existing and paying 10,000 + 75,000 = 85,000.
They would choose the cheapest so the cost is 85,0003. (Not in the syllabus)
Contribution is 55% x 480,000 = 264,000.
Margin of safety is 20% x 264,000 = 52,800
Therefore breakeven contribution = 264,000 – 52,800 = 211,200 = fixed overheads.4. (Not in the syllabus)
Contribution per unit = 85 – 53 = 32 per unit.
Breakeven contribution = 30,000/32 = 937.5
Budget sales = 937.5 + 1750 = 2687.5 units
Therefore budget revenue = 2687.5 x 85 = $228437.55. variable cost per unit = (348252 – 336548) / (12410 – 11640) = $15.20
Fixed cost = 336548 – (11640 x 15.20) = $159,620
I really do suggest that you watch the free lectures on here. They are a complete course for Paper F2 and cover everything you need to pass the exam well.
Really thanks you teacher for answering all of my question. These question I got it from here https://www.scribd.com/doc/17836176 . In this mock exam most question were appeared on CBE test and I just trying to solve all the problem in it.
Teacher I have some questions to ask you more.
Q1: A business uses 65,000 units of an item every year, and works for 52 weeks per year. There is a delay of three weeks between placing an order for the item and receiving it.
What should be set as reorder level to ensure that inventory arrives just as its needed?
Q2: In a budget prepared for an output of 20,000 units, the total labour cost is $48,000. of this total, 40% is the fixed salary of a supervisor, the remainder is the variable cost of direct labor. What will the total labor cost be if the budget is flexed to 24,000 units?I am sorry but that website is hosting pirate material, which is illegal, and so I cannot help further. (It is obvious also that the exam is very out of date.)
You should watch the free lectures that we provide legally – they will answer all of your questions and prepare you properly for the exam.
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