Nina, Sam’s management accountant, can now put together a budget income statement for 2019. She has agreed estimated expenses with Sam: sales and marketing of £98,000, distribution of £23,000, and administration of £67,250.

a) Calculate the unit cost for each product by adding together the raw material, direct labour, and overhead cost per unit.

b) Calculate the cost of sales from your previous calculations.

c) By putting together sales, cost of sales, and other expenses, how much profit can the business expect to make?