Cass Company has recorded the following information for the last six months of operations from its cost of quality syster Quarter 1 $ 790,000 Revenue Costs Warranty expense Machine calibration Customer returns (defects) Material inspection on receiving dock Waste Quality testing equipment Rework Inspection before packaging Training on testing equipment $ 15,800 4,400 23,400 9,720 19,600 19,300 Required: Construct a cost of quality report for Quarter 1 and Quarter 2. 2,880 8,200 6,800 Quarter 2 $ 950,000 $ 15,000 8,560 19,600 6,720 15,920 12,900 4,850 10,100 10, 200

Cass Company has recorded the following information for the last six months of operations from its cost of quality syster Quarter 1 $ 790,000 Revenue Costs Warranty expense Machine calibration Customer returns (defects) Material inspection on receiving dock Waste Quality testing equipment Rework Inspection before packaging Training on testing equipment $ 15,800 4,400 23,400 9,720 19,600 19,300 Required: Construct a cost of quality report for Quarter 1 and Quarter 2. 2,880 8,200 6,800 Quarter 2 $ 950,000 $ 15,000 8,560 19,600 6,720 15,920 12,900 4,850 10,100 10, 200

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter14: Quality And Environmental Cost Management

Section: Chapter Questions

Problem 27E: Using the Taguchi quality loss function, an average loss of 20 per unit is calculated. During the...

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The manager at Rainbow International prepares a Cost of Quality report to report the following expenses: Inspection of raw material costs Warranty costs warranty claims Cost to dispose of rejected products Train hourly manufacturing personnel Recall of batch #2894 O A. $6,900 $6,900 B. $230,000 C. $193,000 D. $150,000 E. $534,000 $230,000 Production losses due to machine malfunctions $27,000 Cost of defective products found at inspection audit $67,000 Inspecting products when halfway through the production process $26,000 Which of the following total cost is the total cost of quality in the external failure cost category? $16,000 $60,000 $150,000
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Listed below are selected items from the cost-of-quality (COQ) report for Watson Products for last month: Category Amount Rework $ 770 Equipment maintenance 1,289 Product testing 921 Field-service costs 650 Spoilage 558 Product liability insurance 870 Product repair 740 What is Watson’s total prevention and appraisal cost for the month?
Davis, Inc., had the following quality costs for the years ended December 31, 20x4 and 20x5: 20x4 20x5 Prevention costs: Quality audits $63,000 $94,500 Vendor certification 118,500 177,750 Appraisal costs: Product acceptance $94,000 $141,000 Process acceptance 113,000 117,500 Internal failure costs: Retesting $98,000 $88,000 Rework 204,000 179,000 External failure costs: Recalls $130,000 $104,000 Warranty 300,000 290,000 At the end of 20x4, management decided to increase its investment in control costs by 50 percent for each category’s items with the expectation that failure costs would decrease by 20 percent for each item of the failure categories. Sales were $12,500,000 for both 20x4 and 20x5. Required: 1. Calculate the budgeted costs for 20x5. $fill in the blank 4e356df4cfd006b_1…
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Long-Term Performance Report Nabors Company had actual quality costs for the year ended June 30, 20x5, as given below. Prevention costs: Prototype inspection $ 380,000 Vendor certification 760,000 Total prevention costs $ 1,140,000 Appraisal costs: Process acceptance $ 395,000 Test labor 440,000 Total Appraisal costs $ 835,000 Internal failure costs: Retesting $ 227,500 Rework 455,000 Total internal failure costs $ 682,500 External failure costs: Recalls $ 293,750 Product liability 536,250 Total external failure costs $ 830,000 Total quality costs $3,487,500 At the zero-defect state, Nabors expects to spend $475,000 on prototype inspection, $95,000 on vendor certification, and $60,000 on process acceptance. Assume sales to be $3,000,000. Required: Question Content Area 1. Prepare a long-range performance report for 20x5. Enter all answers as positive amounts. If the budget variance amount…
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Nabors Company had actual quality costs for the year ended June 30, 20x5, as given below. At the zero-defect state, Nabors expects to spend 375,000 on quality engineering, 75,000 on vendor certification, and 50,000 on packaging inspection. Assume sales to be 25,000,000. Required: 1. Prepare a long-range performance report for 20x5. What does this report tell the management of Nabors? 2. Explain why quality costs still are present for the zero-defect state. 3. What if Nabors achieves the zero-defect state reflected in the report? What are some of the implications of this achievement?
Using the Taguchi quality loss function, an average loss of 20 per unit is calculated. During the year, 25,000 units were produced. Which of the following statements represents the correct application of the Taguchi loss function? a. The hidden costs of internal failure are 500,000. b. The hidden costs of external failure are 500,000. c. The costs of detection activities are 20 per unit inspected. d. The total external costs are 500,000.
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Quality Cost Report Kang Company reported sales of $3,240,000 in 20x5. At the end of the calendar year, the following quality costs were reported: Design review $162,000 Recalls 54,000 Reinspection 27,000 Materials inspection 21,600 Quality training 54,000 Process acceptance 27,000 Scrap 18,900 Lost sales 108,000 Product inspection 16,200 Returned goods 51,300 Required: Question Content Area 1. Prepare a quality cost report. Round percentages to two decimal places, if rounding is required. For example, 5.79% would be entered as "5.79". Kang CompanyQuality Cost ReportFor the Year Ended December 31, 20x5 Quality Costs Total Quality Cost Percentage of Sales Prevention costs: $- Select - - Select - $- Select - - Select -% Appraisal costs: $- Select - - Select - - Select - - Select - - Select - Internal failure costs: $- Select - - Select - - Select - - Select - External…