Do I need to know Learning Curve?

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  • October 17, 2011 at 4:23 pm #162237
    Anonymous
    Inactive

    As I’m practicing with the Gleim software, I’m encountering a lot of challenging questions on Learning Curve. I checked the Wiley book and all they do is simply define it in 2 sentences. So, it seems as though you only need to know what it means. But Gleim is giving a lot of real difficult problems on it. As I was getting them wrong, I’m finally learning how to solve these problems. But the thing is…. is this really tested? Or am I wasting my time trying to figure this out?

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  • October 17, 2011 at 4:24 pm #303587
    Minimorty
    Participant

    My guess is wasting your time. WTF is the learning curve? Which section does it even fall under (i know BEC, but is it under Econ, cost, what?). I cant imagine it is heavily tested.

    October 17, 2011 at 4:31 pm #303588
    IamBlessed
    Participant

    just know the concept of the learning curve in the theory sense … its not as heavily tested as other areas

    October 17, 2011 at 4:35 pm #303589
    Anonymous
    Inactive

    It's under Cost Accounting.

    Basically, if a firm has an 80% learning curve and it costs $100 to produce 1 unit, then it will cost only $160 to produce twice that amount, which is 2 units. 100 x 2 = 200 x .8 = 160. So, they may ask…. with a learning curve of 80%, how much will it cost to produce 16 units?

    I spent so much time learning this and now, It looks like I wasted my time. Ugh!!

    October 17, 2011 at 4:36 pm #303590
    Anonymous
    Inactive

    Yeah I have no idea what that is and I just passed BEC during the last testing window.

    October 17, 2011 at 4:38 pm #303591
    Minimorty
    Participant

    lmao. Dude, you already know way more about the learning curve than you need to. Move on to the next topic!

    October 17, 2011 at 4:46 pm #303592
    Anonymous
    Inactive

    LOL! This is frustrating. You just don't know what to study for in these exams. You either study too little or waste time studying unnecessary topics. Sigh!!

    October 17, 2011 at 6:59 pm #303593
    iPass
    Member

    I don't think I've seen any questions related to learning curve on my exam, but you never know what's gonna pop-up on yours. And if you know the concept, then good for you, perhaps this extra point or two will make a difference, and 75 is way better than 74 🙂 Better safe that sorry.

    Also remember that learning curve only occurs when cumulative output doubles. So let's say in your example they will ask you how much will it cost to produce 18 units instead of 16, then you know that unit #17 & #18 will cost as much as much as unit #18 on average, because there is no learning curve until production reaches 32 units.

    As Mini said, it's time for you to move on to the next topic! Best of luck to you, CPAMan!

    BEC - 10/12/2011 - 78
    AUD - 11/23/2011 - 84
    FAR - 02/22/2012 - 76 (I'll take it!)
    REG - 08/31/2012

    “Win as if you were used to it, lose as if you enjoyed it for a change.”
    -Ralph Waldo Emerson

    October 17, 2011 at 7:13 pm #303594
    Anonymous
    Inactive

    “So let's say in your example they will ask you how much will it cost to produce 18 units instead of 16, then you know that unit #17 & #18 will cost as much as much as unit #18 on average, because there is no learning curve until production reaches 32 units.”

    Ok, you got me there! I'm confused. But spending time figuring that out may be a waste of time. So far, I haven't encountered anything that obscure on Gleim, so it looks like I should be ok…. I think. :/

    I think I should spend more time on Corporate Governance, IT, Economics and Financial Management.

    October 17, 2011 at 7:42 pm #303595
    Sherrid
    Member

    I've never been asked about the learning curve (I've taken the BEC portion 3x) but that doesn't mean it won't be on your test. I'm using Becker and they have 2 or 3 questions on it. I wouldn't spend too much time on it. Good luck!

    October 17, 2011 at 9:10 pm #303596
    iPass
    Member

    I'm sorry, CPAMan, I didn't mean to confuse you. I think you do know more than enough about learning curve already. I'm just getting way too excited when it comes to cost accounting lol. I know, I'm weird, but I had this amazing professor in college for cost accounting. His exams were so hard that me and my study buddies worked out every textbook problem trying to twist it making it as hard as possible lol.

    If you are still interested, I can explain what has to be done. But again, don't waist your time figuring out something that will most likely wont be on the exam.

    So, here's your example. “if a firm has an 80% learning curve and it costs $100 to produce 1 unit, then it will cost only $160 to produce twice that amount, which is 2 units. 100 x 2 = 200 x .8 = 160. So, they may ask…. with a learning curve of 80%, how much will it cost to produce…” let's make it simple, how much will it cost to produce 3 units. Your average coast per unit is $160/2=$80. You know that the learning curve only occurs when the output doubles. So your average cost will not decrease until you make twice as much, meaning 4 units. The coast of your unit #3 is the same as the average coats per unit when you produce 2 units, $80. So total coast for 3 unit 3x$80=$240.

    If I confused you even more, just disregard everything I said. The chance that you will be tested on learning curve is very little, but you will be tested on Corporate Governance, IT, Economics and Financial Management for sure! Skim through your books, review your notes, and just keep doing MCQ.

    BEC - 10/12/2011 - 78
    AUD - 11/23/2011 - 84
    FAR - 02/22/2012 - 76 (I'll take it!)
    REG - 08/31/2012

    “Win as if you were used to it, lose as if you enjoyed it for a change.”
    -Ralph Waldo Emerson

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