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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 40 percent complete in Stitching and 40 percent complete in Customizing. Conversion costs are allocated based on the number of equivalent units processed in each department.

Total Rookie Novice Hiker Expert

Units started 620 490 330 270

Units completed in Stitching 540 455 305 235

Units completed in Customizing 435 275 220

materials $60,930 $22,940 $13,720 $13,200 $11,070

Conversion Costs

Stitching $55,260

Customizing 31,000

Total Conversion costs $86,260

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?

A. Unit cost

Rookie

Novice

Hiker

Expert

B. Work-in-process inventory

Stitching

Customizing

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