A lean manufacturer reports the following quality costs. Prepare a cost of quality report. Training machine operators Product recalls Scrap of defective products Inspecting finished goods Total Prevention Appraisal Quality Category Internal failure External failure Total cost of quality $ 50,000 20,000 12,000 18,000 $ 100,000 Cost of Quality Report Cost Category Total % of Total Cost of Quality % % % % %

A lean manufacturer reports the following quality costs. Prepare a cost of quality report. Training machine operators Product recalls Scrap of defective products Inspecting finished goods Total Prevention Appraisal Quality Category Internal failure External failure Total cost of quality $ 50,000 20,000 12,000 18,000 $ 100,000 Cost of Quality Report Cost Category Total % of Total Cost of Quality % % % % %

Financial And Managerial Accounting

15th Edition

ISBN:9781337902663

Author:WARREN, Carl S.

Publisher:WARREN, Carl S.

Chapter27: Lean Manufacturing And Activity Analysis

Section: Chapter Questions

Problem 16E: Cost of quality report A. Using the information in Exercise 15, identify the cost of quality...

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Matching cost-of-quality examples to categories Sammy, Inc. manufactures motor scooters. For each of the following examples of quality costs, indicate which of the following quality cost categories each example represents: prevention costs, appraisal costs, internal failure costs, or external failure costs. Preventive maintenance on machinery Direct materials, direct labor, and manufacturing overhead incurred to rework a defective scooter that is detected in-house through inspection Lost profits from lost sales if the company’s reputation is hurt because customers previously purchased a poor-quality scooter Cost of inspecting raw materials, such as chassis and wheels Working with suppliers to achieve on-time delivery of defect-free raw materials Cost of warranty repairs on a scooter that malfunctions at a customer’s location Costs of testing durability of the vinyl Cost to reinspect reworked scooters
How do you conclude calculating measuring quality cost to a percentage for the total cost of quality. Percentage cost $357,000. appraisal cost $445,000 internal failure cost $779,000 external failure cost $1,100,00.
Quality costs The accounting system for Dolment Co. reflected the following quality costs for Year 1 and Year 2: Customer refunds for poor product quality Fitting machines for mistake-proof operations Supply chain management activities Waste disposal Quality training Litigation claims for product defects Year 1 Year 2 $37,000 $29,000 9,400 11,800 9,000 10,000 44,000 36,000 26,000 30,000 81,000 64,000 a. Which of these are costs of compliance, and which are costs of noncompliance? b. Calculate the percentage change in each cost and for each category. Note: Round each percentage change to the nearest whole percentage. Note: Indicate a decrease with a negative sign. Customer refunds for poor product quality Fitting machines for mistake-proof operations Supply chain management activities Waste disposal Quality training Litigation claims for product defects Compliance cost category Noncompliance cost category Year 1 Year 2 Percentage Change $37,000 $29,000 % 9,400 11,800 % ÷ 9,000 10,000 %…
Question 3 The Buffalo Machine Sdn. Bhd. was evaluating its cost structure relating to quality costs. Below items are the cost of quality in the year 2020. With this allocation of quality costs, the company lost 20% of sales due to poor performance. To improve the situation, the company would like to perform the cost of quality analysis. Items Product Reliability Test Process Quality Assurance Audit Rework Cost Production Inspection Supplier Quality System Audit Defect Repair Cost Market Defect Cost Sampling Inspection Quality Assurance Training Product Warranty Cost Cost/RM 10000 8500 12000 12000 5500 18000 80000 8000 16000 40000 a) Identify the items for prevention, appraisal, and failure costs. b) Compute the ratio of prevention, appraisal, and failure costs to total quality costs. c) Based on the analysis of the cost of quality, recommend the company's actions to improve the product quality.
Schedule of Activity Costs Quality Control Activities Product testing Assessing vendor quality Recalls Rework Scrap disposal Product design Training machine operators Warranty work Process audits From the provided schedule of activity costs, determine the (a) value-added and (b) non-value-added costs. 2 a. Value-added costs $ Activity Cost $55,000 26,000 18,000 29,000 8,000 30,000 46,000 12,000 22,000 b. Non-value-added costs $
Prepare a cost of quality report. Round the percents of total quality cost to the nearest whole number and the percents of total sales to one decimal place. Cost of Quality Report Percent of Total Quality Quality Cost Classification Quality Cost Percent of Total Sales Cost Prevention Appraisal Internal failure External failure Total % 1.1.0.0.0 % % % % %
Fabrick Company's quality cost report is to be based on the following data: Lost sales due to poor quality Quality data gathering, analysis, and reporting Net cost of spoilage Re-entering data because of keying errors Test and inspection of in-process goods Final product testing and inspection Statistical process control activities Returns arising from quality problems Downtime caused by quality problems $ 20,30 $ 63,306 $ 60,200 $ 24,100 $ 11,200 $ 44,400 $ 43,100 $ 36,100 $ 59,800 What would be the total appraisal cost appearing on the quality cost report? Multiple Choice $162,000 $91,300 $71.400 $55.600 [O ASUS ge here to search
MKD Company's quality cost report is to be based on the following data: 3,550,000 Test and inspection of incoming materials Supplies used in testing and inspection 2,550,000 Re-entering data because of keying errors Statistical process control activities Technical support provided to suppliers 3,000,000 4,100,000 4,550,000 Disposal of defective products Lost sales due to poor quality 3,000,000 4,350,000 Net cost of crap 4,250,000 Warranty repairs and replacements 3,500,000 Required: Prepare a Quality Cost Report in good from with separate sections for prevention costs, appraisal costs, internal failure costs, and external failure costs
On a Cost of Quality report, which of the following cost items should be classified as an internal failure cost? Question 18 options: Net cost of scrap Customer returns of defective products Training for quality control employees Patent cost for a new product
Schedule of Activity Costs Quality Control Activities Product testing Assessing vendor quality Recalls Rework Scrap disposal Product design Training machine operators Warranty work Process audits Activity Cost $55,000 26,000 18,000 29,000 8,000 30,000 46,000 12,000 22,000 From the provided schedule of activity costs, determine the internal failure costs.
Quality Control Activities Product testing Assessing vendor quality Recalls Rework Scrap disposal Product design Training machine operators Warranty work Process audits Schedule of Activity Costs LA From the provided schedule of activity costs, determine the external failure costs. S Activity Cost $55,000 26,000 18,000 29,000 8,000 30,000 46,000 12,000 22,000
Schedule of Activity Costs Quality Control Activities Product testing Assessing vendor quality Recalls Rework Scrap disposal Product design Training machine operators Warranty work Process audits From the provided schedule of activity costs, determine the (a) prevention and (b) appraisal costs. a. Prevention costs $ Activity Cost $55,000 26,000 18,000 29,000 8,000 30,000 46,000 12,000 22,000 b. Appraisal costs $