Golf courses are demanding in their quest for high-quality carts because of the critical need for lawn maintenance. Antaris Co. manufactures golf carts and is a recognized leader in the industry for quality products. In recent months, company managers have become more inter-ested in trying to quantify the company’s cost of quality. As an initial effort, the company identified the following annual costs by categories that are associated with quality. (See attached) Managers were also aware that 600 of the 19,200 carts produced had to be sold as seconds. These 600 carts were sold for $160 less profit per unit than “good” carts. Also, the company incurred rework costs amounting to $14,400 to sell 480 other carts through regular market channels. Using these data, calculate Antaris Co.’s expense for the following: 1. Lost profit from the 600 units $______ 2. Total failure cost $______ 3. Total quality cost $______
Golf courses are demanding in their quest for high-quality carts because of the critical need for lawn maintenance. Antaris Co. manufactures golf carts and is a recognized leader in the industry for quality products. In recent months, company managers have become more inter-ested in trying to quantify the company’s cost of quality. As an initial effort, the company identified the following annual costs by categories that are associated with quality. (See attached)
Managers were also aware that 600 of the 19,200 carts produced had to be sold as seconds. These 600 carts were sold for $160 less profit per unit than “good” carts. Also, the company incurred rework costs amounting to $14,400 to sell 480 other carts through regular market channels.
Using these data, calculate Antaris Co.’s expense for the following:
1. Lost profit from the 600 units $______
2. Total failure cost $______
3. Total quality cost $______
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