A Job with a 70 Percent Learning Curve Required 20

question 39

Multiple Choice

A job with a 70 percent learning curve required 20 hours for the initial unit. The fourth unit should require approximately how many hours?

• A)6
• B)9.8
• C)14
• D)20
• E)34

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Definitions:

Cost Allocation

The process of identifying, aggregating, and assigning costs to cost objects such as products, departments, or projects.

Weighted-Average Method

A cost flow assumption used in inventory valuation that averages the cost of goods available for sale.

Cost Per Equivalent Unit

An accounting measure used in process costing that represents the cost incurred to produce an equivalent unit of production.

Step-Down Method

A cost allocation method used in costing multiple service departments where the cost of one service department is allocated to others and subsequently to production departments.