Exhibit 6-6 Sauer Company Sells Folding Chairs for $40.00 Per Unit.Variable Cost

Multiple Choice

Exhibit 6-6
Sauer Company sells folding chairs for $40.00 per unit.Variable cost is $15.00 per unit.Each chair requires 4 direct labor hours and 2 machine hours to produce.
-Refer to Exhibit 6-6.Which of the following is the correct contribution margin per direct labor hour?

A) $12.50
B) $6.25
C) $0.08
D) $0.10
E) None of the answer choices is correct.