Choose the correct answer and explain why.

At May 1, 2016, Bibby Company had beginning inventory consisting of 200 units with a unit cost of $7. During May, the company purchased inventory as follows:

800 units at $7

600 units at $8

The company sold 1,000 units during the month for $12 per unit. Bibby uses the average cost method. The average cost per unit for May is

a. $7.000.

b. $7.375.

c. $8.000.

d. $9.000.