mu1.diff

diff --git i/lib/broccoli/default-packager.js w/lib/broccoli/default-packager.js
index 1228226ee..af184f6db 100644
--- i/lib/broccoli/default-packager.js
+++ w/lib/broccoli/default-packager.js
@@ -845,46 +845,33 @@ module.exports = class DefaultPackager {
         annotation: 'Tests To Process',
       });
 
-
       if (this.isModuleUnificationEnabled) {
 
         let destDir,
-            testSrcTree,
-            srcDir,
-            dirNotFound;
+            testSrcTree;
 
         // ember-addon
         if (this.name === 'dummy') {
-          testSrcTree = 'src';
+          // Search the addon folder to find inline tests (src/components/hola/component-test.js)
+          testSrcTree = this.project.root;
           destDir = `${this.project.name()}/src`;
-          // Classic Addon with MU dummy app `kitchen-sink-with-mu-dummy-app` will throw: `Dir not found: src` exception
-          // `dirNotFound` will skip this error. Find better way to avoid this error.
-
-          // also, in tests we pass root path to this function
-          // in default-packager/tests-test.js
-          const srcPath = typeof tree === 'string' ? `${tree}/src` : 'src';
-          dirNotFound = !fs.existsSync(srcPath);
         } else {
           testSrcTree = tree;
           destDir = `${this.name}/src`;
-          srcDir = 'src';
         }
 
-        if (!dirNotFound) {
-          testSrcTree = new Funnel(testSrcTree, {
-            srcDir,
-            include: ['**/*-test.{js,ts}'],
-            annotation: 'Module Unification Tests',
-          });
-
-          testSrcTree = new Funnel(testSrcTree, {
-            destDir,
-          });
+        testSrcTree = new Funnel(testSrcTree, {
+          srcDir: 'src',
+          // allowEmpty in order a MU app can run inside a Classic addon
+          allowEmpty: true,
+          include: ['**/*-test.{js,ts}'],
+          destDir,
+          annotation: 'Module Unification Tests',
+        });
 
-          treeToCompile = mergeTrees([treeToCompile, testSrcTree], {
-            annotation: 'Merge MU Tests',
-          });
-        }
+        treeToCompile = mergeTrees([treeToCompile, testSrcTree], {
+          annotation: 'Merge MU Tests',
+        });
       }
 
       treeToCompile = callAddonsPreprocessTreeHook(this.project, 'test', treeToCompile);