Tire and Spoke Manufacturing Currently Produces 1,000 Bicycles Per Month

Multiple Choice

Tire and Spoke Manufacturing currently produces 1,000 bicycles per month. The following per unit data apply for sales to regular customers:

The plant has capacity for 3,000 bicycles and is considering expanding production to 2,000 bicycles. What is the per unit cost of producing 2,000 bicycles?

A) $74 per unit
B) $134 per unit
C) $79 per unit
D) $158 per unit