## Answers

SOLUTION : | ||

Prime Cost : Direct cost related to production and service is a prime cost. | ||

Direct cost is Direct Labor and direct materials is included in prime cost. | ||

Prime Cost = Direct Material + Direct Labor | ||

Prime Cost Per Unit = Direct Material Per Unit + Direct Labor Per Unit | ||

Prime Cost Per Unit = $ 150 Per Unit + $ 105 Per Unit | ||

Prime Cost Per Unit = $ 255 Per Unit | ||

Answer = Option 3 = $ 255 | ||

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