XYZ Limited produces the product P. The cost accountant of the company has to prepare its budget for a particular year. The following information…

XYZ Limited produces the product P. The cost accountant of the company has to prepare its budget for a particular year. The following information are made available for this purpose: The expected sales of the product P is 1,00,000 units during the year at a selling price of 50 per unit. Each unit of product P requires 3 kgs of raw material Q and 4 kgs of raw material R. The expected stock levels are as follows: Beginning of year End of year Finished product P in units 12,000 15,000 Raw material Q in kgs 26,000 20,000 Raw material R in kgs 36,000 42,000 Raw material Q costs 2 per kg and R costs 3 per kg. It requires 10 minutes of direct labour time to produce one unit of product P. Labour cost is 50 per hour. Variable manufacturing overheads are 10 per unit. Fixed manufacturing cost is 3,00,000 per year. Fixed Administration and selling expenses are - 25,000 per year. On the basis of above Case Scenario, you are required to answer the following MCQs 6 to 10: