Harriman Industries manufactures engines for the aerospace industry. It has completed manufacturing the first unit of the
Question:
Harriman Industries manufactures engines for the aerospace industry. It has completed manufacturing the first unit of the new ZX-9 engine design. Management believes that the 1,000 labor hours required to complete this unit are reasonable and is prepared to go forward with the manufacture of additional units. An’80 percent cumulative average-time learning curve model for direct labor hours is assumed to be valid. Data on costs are as follows:
Required:
1. Set upa table with columns for cumulative number of units, cumulative average time per unit in hours, cumulative total time in hours, and individual unit time for the nth unit in hours. Complete the table for 1, 2,4, 8, 16, and 32 units. (Use the logarithmic equation to get the individual unit time.)
2. What are the total variable costs of producing 1, 2, 4, 8, 16, and 32 units? What is the variable cost per unit for 1, 2, 4, 8, 16, and 32 units?LO1
Step by Step Answer:
Introduction To Cost Accounting
ISBN: 9780538749633
1st International Edition
Authors: Don R. Hansen, Maryanne Mowen, Liming Guan, Mowen/Hansen