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Required: a. What is the unit cost of each model transferred to finished goods in August? b. What is the balance of the Work-in-Process Inventory on August 31 for Stitching? For Customizing?

Required: a. What is the unit cost of each model transferred to finished goods in August? b. What is the balance of the Work-in-Process Inventory on August 31 for Stitching? For Customizing?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Miller Outdoor Equipment (MOE) makes four models of tents. The model names are Rookie, Novice, Hiker, and Expert. MOE manufactures the tents in two departments: Stitching and Customizing. All four models are processed initially in Stitching where all material is assembled and sewn into a basic tent. The Rookie model is then transferred to finished goods. After processing in Stitching, the other three models are transferred to Customizing for additional add-ons, and then transferred to finished goods. There were no beginning work-in-process inventories on August 1. Data for August are shown in the following table. Ending work in process is 45 percent complete in Stitching and 45 percent complete in Customizing. Conversion costs are allocated based on the number of equivalent units processed in each department. Units started Units completed in Stitching Units completed in Customizing Materials Conversion costs: Stitching Customizing Total conversion costs Total Rookie Novice Hiker 370 Expert 780 550 270 730 490 330 215 480 315 190 $70,310 $24,180 $20,900 $14,430 $10,800 $53,260 29,000 $82,260 Required: a. What is the unit cost of each model transferred to finished goods in August? b. What is the balance of the Work-in-Process Inventory on August 31 for Stitching? For Customizing?
Transcribed Image Text:Miller Outdoor Equipment (MOE) makes four models of tents. The model names are Rookie, Novice, Hiker, and Expert. MOE manufactures the tents in two departments: Stitching and Customizing. All four models are processed initially in Stitching where all material is assembled and sewn into a basic tent. The Rookie model is then transferred to finished goods. After processing in Stitching, the other three models are transferred to Customizing for additional add-ons, and then transferred to finished goods. There were no beginning work-in-process inventories on August 1. Data for August are shown in the following table. Ending work in process is 45 percent complete in Stitching and 45 percent complete in Customizing. Conversion costs are allocated based on the number of equivalent units processed in each department. Units started Units completed in Stitching Units completed in Customizing Materials Conversion costs: Stitching Customizing Total conversion costs Total Rookie Novice Hiker 370 Expert 780 550 270 730 490 330 215 480 315 190 $70,310 $24,180 $20,900 $14,430 $10,800 $53,260 29,000 $82,260 Required: a. What is the unit cost of each model transferred to finished goods in August? b. What is the balance of the Work-in-Process Inventory on August 31 for Stitching? For Customizing?
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