Sorry, but I have no idea what you are asking. The maximum demands are 20,000 and 10,000 units and so I don’t know where you are getting your figures from.

It is calculated on the budgeted production, because by definition the total fixed cost will not change just because the actual production is different from the budgeted production.

As I make very clear in my free lecture, the total fixed overheads do not (by definition) change with the level of production and they are therefore the budgeted fixed overheads as calculated using the budgeted production.

When calculating the max. profit, I would calculate fixed costs using the quantities of optimum production: A 19.000 u x 3 $/u and B 10.000 u x 2 $/u Is it a mistake?

It is impossible to say – it depends on how much time you have available (whether you are working full time, for example) and how easy or difficult you find the topics. Most people manage to study for the paper within 2 or 3 months.

(In future please ask this sort of question in the Ask the Tutor Forum, and not as a comment on a lecture.)

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mayzin1707 says

Sir,

If we calculate maximum profit by product. Is it same amount 60,000 for A and 20,000 for B?

If so, there is loss result for Product A.

Thanks.

May

John Moffat says

Sorry, but I have no idea what you are asking. The maximum demands are 20,000 and 10,000 units and so I don’t know where you are getting your figures from.

khavipriya12 says

why is the fixed cost assumed to be calculated on the actual demand?

John Moffat says

It isn’t!!

It is calculated on the budgeted production, because by definition the total fixed cost will not change just because the actual production is different from the budgeted production.

John Moffat says

johnak30: Yes, what you have done is a mistake.

As I make very clear in my free lecture, the total fixed overheads do not (by definition) change with the level of production and they are therefore the budgeted fixed overheads as calculated using the budgeted production.

jonak30 says

When calculating the max. profit, I would calculate fixed costs using the quantities of optimum production: A 19.000 u x 3 $/u and B 10.000 u x 2 $/u

Is it a mistake?

Thank you in advance for your answer!

spyakurel says

I could not find the video of bottleneck but it is on the notes. Is it possible to get the video of bottleneck?

John Moffat says

There is no video at the moment. However what is written in the notes, together with the example (and printed answer) should be sufficient.

joelsasi says

Well Explained! Thank you.

siddiq86 says

Explained very well indeed

lindelwa55 says

how long does it take for F5 self study

John Moffat says

It is impossible to say – it depends on how much time you have available (whether you are working full time, for example) and how easy or difficult you find the topics. Most people manage to study for the paper within 2 or 3 months.

(In future please ask this sort of question in the Ask the Tutor Forum, and not as a comment on a lecture.)

fgnhgn says

Thanks a lot for the wonderful explanation.

John Moffat says

Thank you for your comment 🙂

alie2018 says

Thank you John.

John Moffat says

You are welcome 🙂