Arthur Company has two products: S and D. The company uses activity-based costing and has prepared the following analysis showing the estimated total cost and expected activity for each of its three activity cost pools:

Activity	Estimated	Expected Activity
Cost Pool	Ovhd. Cost	Product S	Product D	Total
Activity 1	$20,000	100	400	500
Activity 2	$14,600	500	250	750
Activity 3	$90,000	300	2,700	3,000

The annual production and sales of Product S is 4,547 units. The annual production and sales of Product D is 7,913. The overhead cost per unit of Product S under activity-based costing is closest to:

Question 2 options:

1)

$ 1.83.

2)

$ 1.98.

3)

$ 5.00.

4)

$10.00.