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The following information was received from Sheltie Manufacturing.

Warranty claims $ 170,000
Product liability lawsuits 200,000
Rework costs 600,000
Quality training 355,000
Inspection of incoming material 900,000
Statistical process control 650,000
Waste 390,000
Product quality audits 485,000

Total sales $50,000,000

REQUIRED:

a. Compute the total prevention costs.

b. Compute the total appraisal costs.

c. Compute the total internal failure costs.

d. Compute the total external failure costs.

e. Define each of the above costs.

Accounting Basics, Accounting

  • Category:- Accounting Basics
  • Reference No.:- M943445

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