The First Product Took 10 Hours to Build and the Learning

question 84

Multiple Choice

The first product took 10 hours to build and the learning curve is estimated to be 90%. How long with it take to make the fourth unit?

• A) 10 hours
• B) 9 hours
• C) 8.1 hours
• D) 7.5 hours
• E) none of the above

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Definitions:

Adjusting Entry

An accounting record made to update the financial statements to reflect transactions that have occurred but are not yet recorded.

Interest Expense

The cost incurred by an entity for borrowed funds, usually presented as an expense in the income statement.

Times Interest Earned Ratio

A metric that measures a company's ability to meet its debt obligations by comparing income before interest and taxes to interest expenses.

Net Income

The total profit of a company after all expenses and taxes have been deducted from total revenue, representing the company's bottom line.