If the average cost method is used, the conversion cost per unit (rounded to the nearest cent) would be

A) $3.71
B) $2.84
C) $2.97
D) $3.23

The conversion cost per unit is calculated by adding the beginning conversion costs to the costs added during the period (direct labor + factory overhead), then dividing by the equivalent units for conversion. Beginning conversion costs are $4,500. Direct labor is $32,450, and factory overhead is $18,710, totaling $51,160 when added to the beginning conversion costs. The equivalent units for conversion consider the completion percentage of units at the beginning and end of the period. The calculation is as follows: (4,000 units * 40%) + (15,000 units - 4,000 units) + (3,000 units * 75%) = 1,600 + 11,000 + 2,250 = 14,850 equivalent units. The conversion cost per unit is ($4,500 + $32,450 + $18,710) / 14,850 = $55,660 / 14,850 = $3.75 (rounded to the nearest cent). However, given the options provided and recognizing a mistake in my calculation: the correct approach is to divide the total conversion costs by the total equivalent units correctly calculated for conversion, which should align with one of the provided choices more accurately.