Palmer Company uses activity-based costing. The company produces two products: Earbuds and Head phones. The annual production and sales volume of Earbuds is 8,000 units and of Head phones is 6,000 units. There are three activity cost pools with the following expected activities and estimated total costs:

Activity Cost PoolEstimated CostExpected Activity EarbudsExpected Activity Head phonesTotalActivity 1$20,000100400500Activity 2$37,0008002001,000Activity 3$91,2008003,0003,800

Refer to Palmer Company. Using ABC, the cost per unit of Head phones is approximately:

Select one:

a. $12.00

b. $ 3.90

c. $15.90

d. $ 2.40