SpeedX Automotive Pvt. Ltd. is a well-known manufacturer of automotive components focusing on producing high-quality fuel-efficient engine parts and…

SpeedX Automotive Pvt. Ltd. is a well-known manufacturer of automotive components focusing on producing high-quality fuel-efficient engine parts and transmission systems for both commercial and passenger vehicles. With a strong presence in the Indian market and an expanding footprint in Southeast Asia, SpeedX Automotive has established itself as a reliable supplier in the automotive industry. Headquartered in Pune, Maharashtra, the company is dedicated to meticulous cost management and strategic financial oversight, ensuring operational efficiency and profitability. SpeedX Automotive Pvt. Ltd. allocates significant investments to direct costs, the lifeblood of their manufacturing process. The company spends - 130,000 on purchasing direct materials, ensuring that the quality of raw materials meets their high standards. Direct labor, a critical component of their production, accounts for 90,000, reflecting their commitment to a skilled workforce. Additionally, direct expenses are managed at 30,000, covering various essential costs that directly impact their manufacturing operations. Overhead costs are another crucial aspect of SpeedX Automotive's financial strategy. Factory overheads amount to 60,000, covering all indirect manufacturing expenses. Administration overheads are managed efficiently at 20,000. Selling and distribution overheads are maintained at 10,000, ensuring that products reach the market effectively. Quality control, vital for maintaining the company's reputation, is allocated - 5,000, while - 10,000 is dedicated to research and development, highlighting their focus on innovation. Inventory management is key to SpeedX Automotive's financial health. The opening stock of raw materials stands at 50,000. The work-in-process inventory starts at 15,000 and is increased to 35,000, indicating a smooth production flow. For finished goods, the company maintains an opening stock worth - 30,000, adjusted to a closing stock value of 25,000, showcasing their agile response to market demands. Throughout the period, SpeedX Automotive's manufacturing expertise is evident as they successfully produce 4,000 units. Of these, 3,800 units are sold at a price of 100 per unit. Additional Information: During the period, the price of raw materials fluctuated. At the beginning of the period, the price was 10 per unit. Midway through the period, the price increased to 12 per unit. The company could only purchase 10,000 units at the lower price of 10 per unit. Raw material consumed was 14,000 units. Company follows FIFO method for inventory valuation. Based on the above information, answer the following MCQs (1 to 5):