Costa (continued)

yz Royalties 3,600 Raw materials used in production 320,000 Depreciation: | Machinery used for production 8,000 Office fixtures and fittings 4,200 Delivery vans 3,500 Buildings (% factory; % office; % sales) 10,000 Labour costs directly connected with production 200,000 Other production overheads 70,000 Commission paid to sales force 1,200 Required:

A determination of Costa’s:

(i) prime cost

(ii) production cost

(iii) total cost LO1