1. Seemore Company manufactures binoculars. The actual costs for 2013 and 2014 were as follows:

   	2013		2014
   Direct materials:

   	Plastic case	$ 8.00		$ 7.60
   	Lens set	34.00		34.40

   Direct labor	64.00	(1.6 hours)	60.00	(1.5 hours)
   Indirect manufacturing costs:

   	Variable	16.00		14.20
   	Fixed	4.00	(100,000 units)	3.80	(120,000 units)

   Beginning in 2014, Seemore implemented a continuous improvement program that required a first-year cost reduction target of a 7 percent reduction of the 2013 base. Seemore's continuous improvement target for direct labor in 2014 was:

   	A.	$59.52
   	B.	$70.40
   	C.	$60.00
   	D.	$64.00