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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

Cornerstones of Cost Management (Cornerstones Series)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter14: Quality And Environmental Cost Management
Section: Chapter Questions
Problem 4CE: Nabors Company had actual quality costs for the year ended June 30, 20x5, as given below. At the...
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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
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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