In response to intense foreign competition, Florex Company has taken steps to improve the quality of its products. A summary of its quality costs (in thousands) over the past two years is given below: Costs (in Inspection Quality engineering Depreciation of test equipment Rework labor Statistical process control Cost of field servicing Supplies used in testing Systems development Warranty repairs Net cost of scrap Product testing Product recalls Disposal of production defects thousands) Last This Year Year $ 600 $ 780 $ 360 $ 675 $ 255 $ 150 $ 1,200 $ 1,740 $ 0 $ 45 $ 225 $ 1,125 $ 1,050 $ 45 $ 750 $ 540 $ 3,150 $ 1,350 $ 630 $ 1,200 $ 900 $1,650 $ 750 $ 2,625 $ 810 $ 1,020 Sales have been flat over the past few years, at $75,000,000 per year. Required: 1. Prepare a quality cost report for this year and last year. Note: Enter amount values in thousands. Round your percentage answers to 2 decimal places (i.e 0.1234 should be entered as 12.34). Florex Company Quality Cost Report Amount (in thousands) Last Year Percent of This Year Percent Amount (in of thousands) Sales Sales Prevention costs: Total prevention costs Appraisal costs Total appraisal costs Internal failure costs: Total internal failure costs External failure costs: Total external failure costs Total quality cost
In response to intense foreign competition, Florex Company has taken steps to improve the quality of its products. A summary of its quality costs (in thousands) over the past two years is given below: Costs (in Inspection Quality engineering Depreciation of test equipment Rework labor Statistical process control Cost of field servicing Supplies used in testing Systems development Warranty repairs Net cost of scrap Product testing Product recalls Disposal of production defects thousands) Last This Year Year $ 600 $ 780 $ 360 $ 675 $ 255 $ 150 $ 1,200 $ 1,740 $ 0 $ 45 $ 225 $ 1,125 $ 1,050 $ 45 $ 750 $ 540 $ 3,150 $ 1,350 $ 630 $ 1,200 $ 900 $1,650 $ 750 $ 2,625 $ 810 $ 1,020 Sales have been flat over the past few years, at $75,000,000 per year. Required: 1. Prepare a quality cost report for this year and last year. Note: Enter amount values in thousands. Round your percentage answers to 2 decimal places (i.e 0.1234 should be entered as 12.34). Florex Company Quality Cost Report Amount (in thousands) Last Year Percent of This Year Percent Amount (in of thousands) Sales Sales Prevention costs: Total prevention costs Appraisal costs Total appraisal costs Internal failure costs: Total internal failure costs External failure costs: Total external failure costs Total quality cost
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:In response to intense foreign competition, Florex Company has taken steps to improve the quality of its products. A
summary of its quality costs (in thousands) over the past two years is given below:
Costs (in
Inspection
Quality engineering
Depreciation of test
equipment
Rework labor
Statistical process control
Cost of field servicing
Supplies used in testing
Systems development
Warranty repairs
Net cost of scrap
Product testing
Product recalls
Disposal of production
defects
thousands)
Last
This
Year
Year
$ 600 $ 780
$ 360 $ 675
$ 255
$ 150
$ 1,200 $ 1,740
$ 0
$ 45
$ 225
$ 1,125 $ 1,050
$ 45
$ 750
$ 540
$ 3,150 $ 1,350
$ 630 $ 1,200
$ 900 $1,650
$ 750
$ 2,625
$ 810 $ 1,020
Sales have been flat over the past few years, at $75,000,000 per year.
Required:
1. Prepare a quality cost report for this year and last year.
Note: Enter amount values in thousands. Round your percentage answers to 2 decimal places (i.e 0.1234 should be
entered as 12.34).
Florex Company
Quality Cost Report
Amount (in
thousands)
Last Year
Percent
of
This Year
Percent
Amount (in
of
thousands)
Sales
Sales
Prevention costs:
Total prevention costs
Appraisal costs
Total appraisal costs
Internal failure costs:
Total internal failure costs
External failure costs:
Total external failure costs
Total quality cost
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