Peters Company Produces a Product with the Following Unit Cost

Multiple Choice

Peters Company produces a product with the following unit cost.
Fixed selling costs are $600,000 per year and variable selling costs are $1.50 per unit sold.
Production capacity is 500,000 units per year. However, the company expects to produce only 300,000 units next year. The product normally sells for $15 each. A customer has offered to buy 150,000 units for $10 each. The units would be sold in an area outside the market area currently served.
-The incremental cost per unit associated with the special order is

A) $8.00.
B) $9.25.
C) $9.50.
D) $10.00.