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Rebecca's Pottery Loft makes a variety of handmade pottery items. She has asked for your advice on one of the items manufactured, a clay pelican. The following information is provided.

Defective pelicans 1,100
Number of pelicans returned 150
Pelicans reworked 200
Profit per good pelican $10
Profit per defective pelican $5
Cost to rework defective pelican $4
Processing cost of a returned pelican $20
Appraisal costs $3,400
Prevention costs $6,000

REQUIRED:

a. find out the total profits lost, due to sale of some defective pelicans by Rebecca.

b. find out the rework cost.

c. find out the cost of processing customer returns.

d. find out total failure cost.

e. find out total quality cost.

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M941517

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