The units-of-production approach to depreciation is appropriate when depreciation is a function of time instead of activity.

Pro forma earnings

a. are management's view of permanent earnings. b. are needed for the correction of errors. c. are standardized under generally accepted accounting principles d. are useful to compare two different firms' performance.

A defense contractor has just started producing engines for a new government contract. The first engine took 800 hours to produce. If the learning curve is 80%, how long will it take to produce the first 20 engines?

A) less than or equal to 1000 hours B) from 1000 to 8000 hours C) from 8000 to 8500 hours D) from 8500 to 10000 hours E) 10,000 or more hours