Extra MTQs 2,3

MTQ2 - 3: They are producing 3,175,000 units and therefore need 3,175,000 x 3kg = 9,525,000 kg. At $6 per kg, the cost is 9,525,000 x $6 = $57,150,000 MTQ2 - 4 They buy 6,600,000 kg, therefore they can produce 6,600,000 / 3 = 2,200,000 units. Therefore the number of units available for sale will be 2,200,000 + 325,000 (opening inventory) = 2,525,000 units. The demand is higher than this and so they will sell all the units and have no closing inventory. MTQ3 The fixed overhead volume variance is 2,000 adverse. The standard fixed overheads per unit is $20. Therefore production was 2,000/20 = 100 units less than budgeted. (For more explanation of this you need to watch my free lectures on fixed overhead variances. The lectures are a complete free course and cover everything needed to be able to pass Paper F2 well.)

Thanks a lot sir .... I got everything.

You are welcome :-)