Annual COQ Report, Adirondack Company 2016 2017 Supplier evaluation Scrap Warranty repair costs Design engineering Inspection $ 5,000 $ 1,500 $ ,980 $ 4,475 $ 3,500 $ 8,980 $ 39,435 $ 5,500 $ 5,900 $ 7,960 $ 6,775 Rework Total COQ Total Revenue $ 4,600 $ 5,800 $ 36,535 $575,000 $500,000 1. Identify the costs-of-quality category (prevention, appraisal, internal failure, and external failure) for each of these costs. 2. Prepare a COQ report by calculating the costs of quality for each category and the ratio of each cOQ category to revenues and total quality costs. 3. Based on the results of requirement 2, would you conclude that Adirondack's quality program has been successful? Prepare a short report to present your case. Required

Annual COQ Report, Adirondack Company 2016 2017 Supplier evaluation Scrap Warranty repair costs Design engineering Inspection $ 5,000 $ 1,500 $ ,980 $ 4,475 $ 3,500 $ 8,980 $ 39,435 $ 5,500 $ 5,900 $ 7,960 $ 6,775 Rework Total COQ Total Revenue $ 4,600 $ 5,800 $ 36,535 $575,000 $500,000 1. Identify the costs-of-quality category (prevention, appraisal, internal failure, and external failure) for each of these costs. 2. Prepare a COQ report by calculating the costs of quality for each category and the ratio of each cOQ category to revenues and total quality costs. 3. Based on the results of requirement 2, would you conclude that Adirondack's quality program has been successful? Prepare a short report to present your case. Required

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Alter's Home Center (AHC) sells renovation and remodeling products to both contractors and individual home owners. One of the services AHC offers is delivery of the purchased products to the customer's work site. Because not all customers take advantage of the delivery service option, ACH adds 10 percent to the cost of the products purchased to cover the delivery cost. A business intern spent the summer at ACH. The intern's assignment was to analyze the delivery service and recommend a better way to charge customers for using it. The intern, who had studied activity-based costing, identified the following activities and the data related to them: Activity Picking order Delivering order Handling complaints Total delivery cost Cost Driver Number of items Number of orders Number of complaints Total order value (before delivery charge) Number of orders Annual Cost $ 321,640 850,500 29,440 $ 1,201,580 The intern selected two customers, who were frequent customers, to use as an illustration…
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The types of costs: Direct fixed cost, contribution margin, Gross margin, step variable, Indirect fixed cost, variable cost and Initial investment.
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