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Tire and Spoke Manufacturing currently produces 1,000 bicycles per month. The following per unit data apply...

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

   Direct materials                                        $50

                  Direct manufacturing labor                          5

                  Variable manufacturing overhead              14

                  Fixed manufacturing overhead                   10

                       Total manufacturing costs                   $79

The plant has a 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?

  

[[selectone]]

a. $158 per unit

b. $79 per unit

c. $134 per unit

d. $74 per unit

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