Q1. ABC Insurance Agency incurred the following activity cost related to service quality. Identify those that are costs of conformance (CC) and those that are costs or non-conformance (NC).

Policy processing improvements- $76,400

Customer complaints responses- 34,100

Policy writer training- 12,300

Policy error loses- $82,700

Policy proofing- 39,500

Q2. Internal reports on quality at Lake lawn Press Company generated the following information for the School Division for the first three months of the year:

Total Sales                 $50,000,000

Costs of quality

Prevention                 $523,000

Appraisal                    77,000

Internal Failure        860,000

 External Failure       640,000

Compute the following. Round to two decimal places

1. Total costs of quality as a percentage of sales

2. Ratio of costs of conformance to total costs of quality

3. Ratio of costs of nonconformance to total costs of quality

4. Cost of nonconformance as a percentage of total sales

Q3. For a fast-food restaurant that specializes in deluxe hamburgers, identify two nonfinancial measures of good products quality and two nonfinancial measures of poor product quality.