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Ferdon Watches, Inc., makes four models of watches, Gag-Gift, Commuter, Sport, and Retirement. Ferdon manufactures the watches in four departments: Assembly, Polishing, Special Finishing, and Packaging. All four models are started in Assembly where all material is assembled. The Gag-Gift is transferred to Packaging, where it is packaged and transferred to finished goods inventory. The Commuter and Sport are assembled, then transferred to Polishing. Once the polishing process is completed, they are transferred to Packaging and then finished goods. The Retirement model is assembled and then transferred to Special Finishing, and then Packaging. When packaged, it is transferred to finished goods.

Data for October are shown in the following table. Conversion costs are allocated based on the number of units processed in each department.

		Total		Gag-Gift (7,400 units)			Commuter (12,400 units)			Sport (17,800 units)			Retirement (4,400 units)
Materials	$	385,000		$	37,000		$	93,000		$	178,000		$	77,000
Conversion costs:
Assembly	$	168,000
Polishing		90,600
Special Finishing		44,000
Packaging		126,000
Total conversion costs	$	428,600

Required:

b. What is the cost per unit transferred to finished goods inventory for each of the four watches in October? (Round "Cost Per Unit" to 2 decimal places.)

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WorksheetDifficulty: 2 MediumLearning Objective: 08-08 Compare

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