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LisaM
Oct 2, 2006, 11:40 AM
I am taking a managerial accounting course online and am having a difficult time trying to figure many problems, but at the moment, just the one below. The text is not very helpful.

Here is the problem:
Two guys work for a landscaping company. In performing their primary job the first time it took 17 hours. Their goal by the end of the season was to complete a job in 8 hours. They performed 8 of these jobs and had an 80% learning curve. Assume that all jobs are approximately the same.

Required: Did they reach their goal? If not, what would the learnig rate have to have been for them to have accomplished their goal?

So far this is what I have:
1 17 hrs
2 17 hrs x .8 = 13.6 hrs

The answer is Yes, they reached their goal. They were able to complete a job within 6.5 hours. But, I don't know how to get there. An example may help me understand. Can you help me?
V/R,
confused: Lisa

CaptainForest
Oct 2, 2006, 02:32 PM
You are correct. They do in fact reach their goal.

As we know, the chart of values is:
Job 1 = 17 hours
Job 2 = 17 hours x 0.8 = 13.6 hours
Job 3 = 13.6 hours x 0.8 = 10.88 hours
Job 4 = 10.88 hours x 0.8 = 8.70 hours
Job 5 = 8.70 hours x 0.8 = 6.96 hours
Job 6 = 6.96 hours x 0.8 = 5.57 hours
Job 7 = 5.57 hours x 0.8 = 4.46 hours
Job 8 = 4.46 hours x 0.8 = 3.57 hours


Or, if you want to say, what will the result be after 8 jobs, the calculation is as follows:

Original Time x Learning Curve^(Total Jobs-1)

So, in this case:
17 hours x 0.8 ^ (8-1)
17 x 0.8^7
=3.57

LisaM
Oct 2, 2006, 03:30 PM
These are the exact figures I got, but I thought I was wrong. Thanks for the help.