Modern Computer Ltd Assignment Help With solution
Modern Computer Limited is an IT consulting firm which helps commercial companies to instal a general accounting programme. It uses 90% cumulative average-time learning model as a basis for forecasting direct labour-hours for the coming jobs. The company’s information is as follows:
|Programme purchase cost||$5,000 per unit|
|Direct labour hour for the first job||200 hours|
|Direct labour cost||$50 per hour|
Note: For a 90% learning curve, b = ln0.9/ln0.2 = -0.152004
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a.Calculate the total costs for the first four jobs.
b.What would be the total costs for the first four jobs if Modern Computer changes to the use of the incremental unit-time learning model?
c.Compare the results of requirements (a) and (b). Why are they different? How would Modern Computer decide which model it should use?
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