This can also be solved using the continuous exponential growth equation instead of counting doublings directly.
The specific growth rate $\mu$ is related to the doubling time $t_d$ by $$\mu = \frac{\ln 2}{t_d} = \frac{0.6931}{1} = 0.6931\ hr^{-1}$$
Growth only occurs during the active phase, which lasts $8 - 1 = 7$ hours (the first hour being the lag phase with zero growth). The exponential growth equation is $$N = N_0\,e^{\mu t}$$
Substituting $N_0 = 2$, $\mu = 0.6931\ hr^{-1}$, and $t = 7$ hours: $$N = 2\,e^{0.6931 \times 7} = 2\,e^{4.8518}$$
Since $0.6931 \times 7 = 4.852 \approx \ln(128)$, this exponential term evaluates to 128, giving $$N = 2 \times 128 = 256$$
The continuous-growth-rate method and the simple doubling method give identical answers, as expected, since they describe the same physical process.
\[\boxed{N = 256\ cells}\]