At an activity level of 20,000 units produced, fixed costs total $30,000 and variable costs total $67,000. Assuming that this activity is within the relevant range, if 25,000 units are produced, then:

Question 27 options:

a)	total fixed costs are expected to be $37,500.
b)	variable cost per unit is expected to equal $2.68.
c)	fixed cost per unit is expected to equal $1.20.
d)	total cost per unit is expected to equal $3.88.

Total production costs for Gallop, Inc. are budgeted at $230,000 for 50,000 units of budgeted output and at $280,000 for 60,000 units of budgeted output. Because of the need for additional facilities, budgeted fixed costs for 60,000 units are 25% more than budgeted fixed costs for 50,000 units. How much is Gallop's budgeted variable cost per unit of output?