Clarke, Inc. manufactures door panels. Suppose Clarke, Inc. is considering spending the following amounts on a new total quality management (TQM) program: View the spending amounts. Clarke, Inc. expects the new program would save costs through the following: View the savings amounts. Requirements 1. Classify each cost as a prevention cost, an appraisal cost, an internal failure cost, or an external failure cost. 2. Should Clarke, Inc. implement the new quality program? Give your reason. Requirement 1. Classify each cost as a prevention cost, an appraisal cost, an internal failure cost, or an external failure cost. Type of Cost Strength-testing one item from each batch of panels Training employees in TQM Training suppliers in TQM Identifying suppliers who commit to on-time delivery of perfect-quality materials Lost profits from lost sales due to disappointed customers Rework and spoilage Inspection of raw materials Warranty costs Savings Avoid lost profits from lost sales due to disappointed customers $ 91,000 Avoid rework and spoilage 66,000 54,000 Avoid inspection of raw materials Avoid warranty costs 16,000 Print Done X Spending Strength-testing one item from each batch of panels Training employees in TQM Training suppliers in TQM Identifying suppliers who commit to on-time delivery of perfect-quality materials Print Done $ 69,000 20,000 32,000 60,000 X Clear all Check answer
Clarke, Inc. manufactures door panels. Suppose Clarke, Inc. is considering spending the following amounts on a new total quality management (TQM) program: View the spending amounts. Clarke, Inc. expects the new program would save costs through the following: View the savings amounts. Requirements 1. Classify each cost as a prevention cost, an appraisal cost, an internal failure cost, or an external failure cost. 2. Should Clarke, Inc. implement the new quality program? Give your reason. Requirement 1. Classify each cost as a prevention cost, an appraisal cost, an internal failure cost, or an external failure cost. Type of Cost Strength-testing one item from each batch of panels Training employees in TQM Training suppliers in TQM Identifying suppliers who commit to on-time delivery of perfect-quality materials Lost profits from lost sales due to disappointed customers Rework and spoilage Inspection of raw materials Warranty costs Savings Avoid lost profits from lost sales due to disappointed customers $ 91,000 Avoid rework and spoilage 66,000 54,000 Avoid inspection of raw materials Avoid warranty costs 16,000 Print Done X Spending Strength-testing one item from each batch of panels Training employees in TQM Training suppliers in TQM Identifying suppliers who commit to on-time delivery of perfect-quality materials Print Done $ 69,000 20,000 32,000 60,000 X Clear all Check answer
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![Clarke, Inc. manufactures door panels. Suppose Clarke, Inc. is considering spending the following amounts on a new total quality management (TQM) program:
View the spending amounts.
Clarke, Inc. expects the new program would save costs through the following:
View the savings amounts.
Requirements
1. Classify each cost as a prevention cost, an appraisal cost, an internal failure cost, or an external failure cost.
2. Should Clarke, Inc. implement the new quality program? Give your reason.
Requirement 1. Classify each cost as a prevention cost, an appraisal cost, an internal failure cost, or an external failure cost.
Type of Cost
Strength-testing one item from each batch of panels
Training employees in TQM
Training suppliers in TQM
Identifying suppliers who commit to on-time delivery of perfect-quality materials
Lost profits from lost sales due to disappointed customers
Rework and spoilage
Inspection of raw materials
Warranty costs
Savings
Avoid lost profits from lost sales due to disappointed customers $ 91,000
Avoid rework and spoilage
66,000
Avoid inspection of raw materials
54,000
Avoid warranty costs
16,000
Print
- X
Done
Spending
C
Strength-testing one item from each batch of panels
Training employees in TQM
Training suppliers in TQM
Identifying suppliers who commit to on-time delivery of perfect-quality materials
Print
Done
- X
$ 69,000
20,000
32,000
60,000
[]
Clear all
Check answer](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff6289e48-e851-4db0-80f7-2678a1a4c339%2Ff646875c-d233-4ff0-a854-4ffc8d4581ef%2Fcnd4jm_processed.png&w=3840&q=75)
Transcribed Image Text:Clarke, Inc. manufactures door panels. Suppose Clarke, Inc. is considering spending the following amounts on a new total quality management (TQM) program:
View the spending amounts.
Clarke, Inc. expects the new program would save costs through the following:
View the savings amounts.
Requirements
1. Classify each cost as a prevention cost, an appraisal cost, an internal failure cost, or an external failure cost.
2. Should Clarke, Inc. implement the new quality program? Give your reason.
Requirement 1. Classify each cost as a prevention cost, an appraisal cost, an internal failure cost, or an external failure cost.
Type of Cost
Strength-testing one item from each batch of panels
Training employees in TQM
Training suppliers in TQM
Identifying suppliers who commit to on-time delivery of perfect-quality materials
Lost profits from lost sales due to disappointed customers
Rework and spoilage
Inspection of raw materials
Warranty costs
Savings
Avoid lost profits from lost sales due to disappointed customers $ 91,000
Avoid rework and spoilage
66,000
Avoid inspection of raw materials
54,000
Avoid warranty costs
16,000
Print
- X
Done
Spending
C
Strength-testing one item from each batch of panels
Training employees in TQM
Training suppliers in TQM
Identifying suppliers who commit to on-time delivery of perfect-quality materials
Print
Done
- X
$ 69,000
20,000
32,000
60,000
[]
Clear all
Check answer
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