The management of Boogie Company thinks that its total costs of quality can be reduced by increasing expenditures in certain key costs of quality categories. The following costs of quality have been identified by management: Cost of Quality Rework Recalls Reengineering efforts Repair Replacements Retesting Supervision Scrap Training Testing of incoming materials Inspection of work in process Downtime Product liability insurance Quality audits Continuous improvement Warranty repairs Costs P 6.000.00 15,000.00 9.000.00 12.000.00 12.000.00 5.000.00 18,000.00 9,000.00 15.000.00 7.000.00 18,000.00 10,000.00 9,000.00 5.000.00 1000.00 15,000.00 Required: 1. Classify these costs into the four costs of quality categories 2. Determine the total pesos being spent on each of the categories 3. Based on the company's expenditures by cost of quality categories, on which cost category should the company concentrate its efforts to decrease its overall costs of quality?

The management of Boogie Company thinks that its total costs of quality can be reduced by increasing expenditures in certain key costs of quality categories. The following costs of quality have been identified by management: Cost of Quality Rework Recalls Reengineering efforts Repair Replacements Retesting Supervision Scrap Training Testing of incoming materials Inspection of work in process Downtime Product liability insurance Quality audits Continuous improvement Warranty repairs Costs P 6.000.00 15,000.00 9.000.00 12.000.00 12.000.00 5.000.00 18,000.00 9,000.00 15.000.00 7.000.00 18,000.00 10,000.00 9,000.00 5.000.00 1000.00 15,000.00 Required: 1. Classify these costs into the four costs of quality categories 2. Determine the total pesos being spent on each of the categories 3. Based on the company's expenditures by cost of quality categories, on which cost category should the company concentrate its efforts to decrease its overall costs of quality?

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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I need help with just 4a please thank you.
Classify the cost elements shown below for the Impressive Printing Company into the proper quality cost categories. Cost Element Amount Quality Cost Category Customer complaint remakes Select -Select- Printing plate revisions Appraisal Quality improvement projects External failure Internal failure Gauging Prevention Other waste -Select- -Select- -Select- -Select- Select -Select- -Select- Correction of typographical errors Proofreading Quality planning Press downtime Bindery waste Checking and inspection $21,100. $27,400 $10,400 $100,000 $33,700 $166,000 $393,000 $53,700 $246,900 Quality Cost Category Prevention Appraisal Internal failure External failure $49,000 $45,700 V Total Amount $ $ V Find the total quality cost by category and percentage of total quality cost by category. Do not round intermediate calculations. Round the monetary values to the nearest dollar and percentage values to two decimal places. V Percentage of Total Quality Cost % % % %
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Value- and Nonvalue-Added Costs Waterfun Technology produces engines for recreational boats. Because of competitive pressures, the company was makong an effort to reduce costs. A part of this effort, management implemented an activity-based management system and began focusing its attention an procetses and activties. Receiving was among the processes (activities) that were carefully studied. The study revealed that the number of receiving orders was a good dnver fur receiving costs. During the last year, the company incurred fixed receiving costs of $630,000 (salaries of 10 empleyees). These fxed costa provide a capacity of processing 72,000 receiving orders (7,200 per employee at practical capacity). Management decided that the efficient level for receiving should use 36,000 receiving orders. Requiredi 1. Explain why receiving would be viewed as a value-added activity. Which of these are possible reasons that explain why the demand for receiving is more than the efficient level of…
Relevant Cost Analysis—Conversion to JIT; Spreadsheet Application As part of its commitment to quality, the J. J. Borden manufacturing company is proposing to introduce just-in-time(JIT) production methods. Managers of the company have an intuitive feel regarding the financialbenefits associated with a change to JIT, but they would like to have some data to inform their decision making in this regard. You are provided with the following data:[LO 17-5][LO 17-1, 17-5]Item Existing Situation After Adopting JITManufacturing Costs as Percentage of Sales:Product-level support 12% 5%Variable manufacturing overhead 28 10Direct materials 30 20Direct manufacturing labor 22 15Other Financial Data:Sales revenue $1,350,000 $1,650,000Inventory of WIP 180,000 30,000Other Data:Manufacturing cycle time 60 days 30 daysInventory financing costs (per annum) 10% 10%Final PDF to printerblo17029_ch17_713-774.indd 760 02/19/18 09:10 AM760 Part Three Operational-Level ControlRequired1. As the management…
Cost-of-Quality Improvement—Relevant Cost Analysis PIM Industries Inc. manufactureselectronics components. Each unit costs $30 before the final test. The final test rejects, on average,5% of the 50,000 units manufactured per year. The average rejection rate of the industry is 3%. A consultant has determined that poor lighting is the most likely cause of this high rejection rate. It wouldcost $100,000 to install adequate lighting in the assembly department, which would be useful for5 years. With adequate lighting (which will cost an additional $5,000 of operating costs per year), thefirm expects to reduce its rejection rate to no higher than the industry average.Required1. Should the firm install the lighting? That is, what would be the projected five-year impact on operatingprofit? (Show calculations.)2. What other considerations might affect this decision?3. What is the primary role of the management accountant in this decision context?
Certain production equipment used by Dayton Mechanical has become obsolete relative to current technology. The company is considering whether it should keep or replace its existing equipment. To aid in this decision, the company’s controller gathered the following data: (See attached) c. What is the total dollar amount of all relevant costs to the equipment replacement decision. $______ d. What is the total dollar amount of the opportunity costs associated with the alternative of keeping the old equipment? $______
Three Rivers Inc. provides cable TV and Internet service to the local community. The activities and activity costs of Three Rivers are identified as follows: Question Content Areaa. Identify the cost of quality classification for each activity and whether the activity is value-added or non-value-added. Quality Control Activities Activity Cost Quality Cost Classification Value-Added/Non-Value-AddedClassificationBilling error correction $42,800 External failure Non-value-addedCable signal testing 117,300 Appraisal Non-value-addedReinstalling service (installed incorrectly the first time) 92,000 Internal failure Non-value-addedRepairing satellite equipment 20,700 Internal failure Non-value-addedRepairing underground cable connections to the customer 27,800 Internal failure Non-value-addedReplacing old technology cable with higher quality cable 142,000 Appraisal Value-addedReplacing old technology signal switches…
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Fabrick Company's quality cost report is to be based on the following data: Lost sales due to poor quality Quality data gathering, analysis, and reporting Net cost of spoilage Re-entering data because of keying errors Test and inspection of in-process goods Final product testing and inspection Statistical process control activities Returns arising from quality problems Downtime caused by quality problems $ 20,30 $ 63,306 $ 60,200 $ 24,100 $ 11,200 $ 44,400 $ 43,100 $ 36,100 $ 59,800 What would be the total appraisal cost appearing on the quality cost report? Multiple Choice $162,000 $91,300 $71.400 $55.600 [O ASUS ge here to search