Squadron 'Letters'
While agreeing with what has been said before I think the letters arose originally in WW1. Whether squadrons, formed for WW2, used the letters I do not know. As a red herring I will add that there were also squadrons with geographical associations although I do not know how these arose. ie No ??? (Gold Coast) Sqn and No ??? (Jamaica) Sqn, to name 2 that I recall.