Innova,Inc ASet Up a Table with Columns for Cumulative Number of 500

Essay

Innova,Inc.,is beginning the production of a new product.Management believes that 500 labour hours will be required to complete the new unit.An 80 percent incremental unit-time learning curve model for direct labour hours is assumed to be valid.Assume the q = -0.3219.Data on costs are as follows:
$\begin{array}{ll}\text { Direct materials } & \$ 50,000 \text { per unit } \\\text { Direct labour } & \$ 20 \text { per direct labour hour } \\\text { Variable manufacturing overhead } & \$ 30 \text { per direct labour hour }\end{array}$

a.Set up a table with columns for cumulative number of units showing the cumulative total time in hours using the incremental unit-time learning curve.Complete the table for 1,2,3,and 4 units given the individual unit time for the nth unit as 500,400,351,and 320 for 1 to 4 units respectively.
b.Set up a similar table assuming a 90 percent with the incremental unit-time learning curve with the individual unit time for the nth unit as 500,450,430,405 for 1 to 4 units respectively.
c.What is the difference in variable cost of producing four units?