Post 2 substantial replies to classmates or your faculty member that are at least 100 words in length. Be constructive and professional. Post a total of 3 substantive responses over 2 separate days for full participation. This includes your initial post and 2 replies to classmates or your faculty member.

Megan Campbell 1. The textbook says that in order to estimate costs, we must determine the relationships between the variables that affect our costs and the decisions we make. More specifically it is critical to estimate how changes in activity level affect these costs. With the engineering cost estimate, the prices of labor, supplies, and other measurements is used to calculate estimated costs.

I used to work for a friend of mine that owned a small landscaping and gardening business that operated seasonally. Because we provided a service, labor made up the majority of her costs. When she quoted projects for customers, their estimate also reflected this. Julie was at every job site, shopped for her companys equipment and supplies, and drove the work truck. I think being so hands-on is a large reason why she was able to monitor her costs so effectively.

One weakness of the engineering cost estimate method is that it can leave missed work or other losses unaccounted for. In Julies case, however, the business was so small and she was willing to do the work herself when needed, her business never suffered from this effect because she would be able to recoup that cost with her own labor. That being said, as the sole proprietor, she essentially worked for free quite often.

Katrina Winger 2. The learning phenomenon is the relationship between the amount of experience that a person has at certain tasks and the amount of time that it takes to complete those tasks. New hires are often slower at the job at first, until they have gained more experience. Even long term employees can be slower at new products that may be introduced, until they have had time to work on them to get better. When it takes longer to complete a task or job, the cost is higher than it really will be. As the job is completed more and more the time will be reduced and the labor cost associated will be more accurate.

The costing method that I am most familiar with is the Engineering Estimate. At my work place we sew covers for lawn mowers. We have a prototype department that designs the covers and does the first runs. When doing this they estimate the time that it takes to complete the cover. After the cover is run on the floor for a few times, to get the production team trained, a time study is done. The time study is an average over a handful of sewers so that the appropriate amount of time can be assigned to each seat cover to ensure that the costing is accurate.