Answer the following questions using the information below:

Stephans Corporation currently manufactures a subassembly for its main product. The costs per unit are as follows:

Direct materials $ 1.00

Direct labor 10.00

Variable overhead 5.00

Fixed overhead8.00

Total $24.00

Bill Company has contacted Stephans with an offer to sell them 5,000 of the subassemblies for $22.00 each. Stephans will eliminate $25,000 of fixed overhead if it accepts the proposal.

What is the maximum price Stephans would be willing to pay for the subassembly from Bill Company?

Group of answer choices

$21 per unit

$19.50 per unit

$18 per unit

$23 per unit