Question - Deep Sea Divers manufactures and sells top-of-the-line diving equipment. Its most popular deep-sea scuba set allows divers to dive deeper than 100 ft. This model sells for $8,000. Manufacturing and other costs, all per unit, are as follows:
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Direct material
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$1,600
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Direct labor
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$3,340
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Variable overhead
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$800
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Fixed overhead
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$350
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Variable sales and administrative expenses
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$280
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Deep Sea Divers has a constraint on how many deep-sea scuba sets can be built in a year, because technical workers are difficult to find and retain. If the labor rate is $72 per hour, what is the contribution margin on the scuba set per labor hour?