TDFW completed two projects during the month of May Although

TDFW completed two projects during the month of May. Although the projects were both similar, the company incurred higher costs for Job 71. Why did Job 71 have higher costs per finished good? Explain/show your work.

Solution

Job 70 has production of 100 units but for Job 71 has produced only 75 units .

Cost of finished goods are calculated as below,

Cost of production per unit = Total Cost Of production / No. of units Prodcued

So, reason for the more cost of Job 71 is less production.(Job 70 gave 100 units and job 71 have 75 units)