Division 1 of Ace Company makes and sells wheels that can either be sold to outside customers or transferred to Division 2. The following data are available from last month:

Division 1:

Selling price to outside customers	$67 per unit
Variable cost when sold to outside customers	$47 per unit
Capacity	25,000 units

Division 2:

Number of wheels needed per month	8,000 units
Price per wheel paid to an outside supplier	$61 per unit

If Division 1 sells the wheels to Division 2, Division 1 can avoid $2 per unit in sales commissions.

Suppose that Division 1 sells 18,000 units each month to outside customers. According to the formula in the text, what is the lowest acceptable transfer price from the viewpoint of the selling division?

$47.50 per unit

$47.30 per unit

$61.00 per unit

$59.00 per unit