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93. Tom and Mike are installing new flooring in their home. The house has 5 rooms of approximately equal size where the flooring will be replaced. Tom and Mike spent 3 hours
removing the old flooring from the first room. The average time to remove the flooring from 2 rooms is 2.25 hours per room. Determine the learning curve percentage experienced by Tom and Mike. Below are values that may be useful in answering this question. (95%) / In(2)--0074 In(90%), In(2)--0.152 in(85%) / ln(2)--0234 in(80%) / ln(2)--0322 in(75%)/In(2)--04 15 (70%) / In(2)--0515 а)70% b) 75% c)80% d) Some other percentage Answer: b Difficulty: Medium Learning Objective: Describe cost estimation techniques. CPA: Management Accounting/Problem-Solving and Decision-Making Bloomcode: Application 94. Consider the folilowing cost data for the cost object, number of machine setups. Each set of costs (A, B, and C) is from a different type of manufacturing operation and represents the cost behaviour for the cost of that companys machine setups. Number of Machine Setups Cost A CostB CostC 0 10 20 30 $80 37 20 40 60 80 100 78 81 79 91 123 154 50 Cost A is best described as: a) Fixed b) Variable c) Mixed d) Direct Answer: b Learning Objective: Describe the different types of cost behaviour, CPA: Management Aocounting/Problem-Solving and Decision-Making Difficulty: Easy or tranamiesion of this page is atty prohated
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Answer #1
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A Determination of Leaning Curve Experienced by Tom and Mike
The correct answer is (b). The calculations are as follows.
1 Time taken for removing the floor of first room 3
2 Time taken for removing the floor of four rooms (cumulative) 9
3 Time taken for removing the floor of second room to fifth room 2.25
Leaning Curve experienced (3/4) 75%
B Cost category of Cost type A
The correct answer is (b). Cost A is variable cost.
Variable cost means, a cost that will increase with increase in the no. of units produced.

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