Assume that Whee, Cheatham, and Howe is an auditing firm that
has found that its summer interns are subject to a 50 percent
learning curve for one of its important tasks, proofreading
financial statements. For one of its interns, Kim Down, the firm
has started to analyze the relation between time and financial
statement proofreading.
Financial Statements Proofread (X) 
Time Required to Proofread the Xth Financial Statement 
1  2.0000 hours 
2  1.0000 hours 
4  ? 
8  ? 
16  ? 
Required:
a. Compute the time required to proofread 4, 8, and 16 financial statements. (Round your answers to 4 decimal places.)
b. Assume that Kim's labor time costs $14 per
hour. Compare the cost of proofreading the 1st financial statement
to the cost of proofreading the 16th financial statement. What is
the percentage of the cost of proofreading the 16th financial
statement to the cost of proofreading the 1st financial statement?
(Do not round your intermediate calculations. Enter your
answer as a percentage rounded to 2 decimal places (i.e.,
32.21))
Financial statement proofreads (X) 
Time Required to Proofread 
Calculation 
1 
2.0000 

2 
1.0000 
(20000×50%) 
4 
5.000 
(10000×50%) 
8 
2.500 
(5.000×50%) 
16 
1.250 
(25000×50%) 
.
(b)
Cost of proofreading the first report = 2 × $14 = $28
Cost of proofreading the 16 report = 1.250 × $14 = $17.500
Percentage = 17.500/28 = 62.50%
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