Consider the following items of income and expense and state: whether they bear a relationship to each other or not; if they are related in any way, in what way they should move in relation to each other; the reasons for your answer in each case.

(a) Sales of manufacturing concern:

• bank interest

• administrative expense

• commission to sales personnel

• distribution cost

• production royalties.

(b) Cost of production of a manufacturing concern:

• trade receivables

• cost of non-current assets in use

• loss on disposal of factory equipment

• inventory levels

• directors’ emoluments.

(c) Gas company income

• number of units of gas used

• temperature in winter months

• electricity company prices

• number of employees.