Czinn Industries makes refrigerators with the following results in 2021: Units manufactured and sold 10,000 $2,000 $1,200 6,000 0.5 Selling price Variable cost per unit Hours spent on design Testing and inspection hours per unit Percentage of units reworked in plant Rework costs per unit Percentage of units repaired at customer site Repair costs per unit Estimated lost sales from poor quality (units) 5% $500 4% $600 300 The labor rate in Design is $75 per hour; the labor rate in Testing & Inspection is $40 per hour. 1. External failure costs =$ 2. Internal failure costs = $ 3. Prevention costs = $ 4. Appraisal costs = $ %3D

Czinn Industries makes refrigerators with the following results in 2021: Units manufactured and sold 10,000 $2,000 $1,200 6,000 0.5 Selling price Variable cost per unit Hours spent on design Testing and inspection hours per unit Percentage of units reworked in plant Rework costs per unit Percentage of units repaired at customer site Repair costs per unit Estimated lost sales from poor quality (units) 5% $500 4% $600 300 The labor rate in Design is $75 per hour; the labor rate in Testing & Inspection is $40 per hour. 1. External failure costs =$ 2. Internal failure costs = $ 3. Prevention costs = $ 4. Appraisal costs = $ %3D

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 20E

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