Melita Sailboats Company Manufactures 10 Luxury Yachts Per Month

Melita Sailboats Company manufactures 10 luxury yachts per month.A compact media center is included in each yacht.Melita Sailboats manufactures the media center in-house but is considering the possibility of outsourcing this function.At present,the variable cost per unit is $300,and the fixed costs are $40,000 per month.If it outsources the media centers,fixed costs could be reduced by half,and the vacant facilities could be rented out to earn $3,000 per month of rental income.At what contract cost would outsourcing pay off for Melita?

A) $2,600 per unit
B) $2,300 per unit
C) $300 per unit
D) $4,000 per unit