What is the average cost per unit at a production level

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Total production costs of prior periods for a company are listed below. Assume that the same cost behavior patterns can be extended linearly over the range of 3,000 to 35,000 units and that the cost driver for each cost is the number of units produced.

Production in units per month               3,000         9,000          16,000                 35,000

Cost X                                               $23,700     $ 52,680        $ 86,490           $178,260

Cost Y                                                  47,280      141,840           252,160           551,600

Question 1 : What is the average cost per unit at a production level of 8,000 units for cost X?

Option A. $5.98

Option B. $5.85

Option C. $7.90

Option D. $4.83

Reference no: EM132533665

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