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
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
icon
Related questions
Question

Please help me 

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?
Expert Solution
steps

Step by step

Solved in 3 steps with 3 images

Blurred answer
Knowledge Booster
Inventory Management
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.
Recommended textbooks for you
FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
Accounting
ISBN:
9781259964947
Author:
Libby
Publisher:
MCG
Accounting
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education