Let h and b be the cost for the hand towels and bath towels, respectively. Then, the statement "39 hand towels and 43 bath towels for $426" can be written as

and the statement "35 hand towels and 97 bath towels for $908" can be written as

So, we have the following system of equations:

Solving by elimination method.
By multiplying the first equation by -35 and the second one by 39, we have an equivalent system of equations:

So, we can eliminate variable h by adding both equations, that is,

Then, we have

Finally, by substituting this result into the first equation, we get

which gives

Therefore, the cost for the hand towels is $1 and for the bath towels is $9.