Identify the cost of quality classification for each activity.

Question

Quality Cost Report Evans Company had total sales of $1,500,000 for fiscal 20x5. The costs of quality-related activities are given below. Returns/allowances $90,000 Design changes 82,500 Prototype inspection 4,500 Downtime 112,500 Quality circles 4,500 Packaging inspection 3,000 Field testing 4,500 Complaint adjustment 105,000 Required: Question Content Area 1. Prepare a quality cost report, classifying costs by category and expressing each category as a percentage of sales. Round percentages to one decimal place, when rounding is required. For example, 5.78% would be entered as "5.8". Evans CompanyQuality Cost ReportFor the Year Ended 20x5 Quality Costs Total Percentage of Sales Prevention costs: $- Select - - Select - $- Select - - Select -% Appraisal costs: $- Select - - Select - - Select - - Select - Internal failure costs: $- Select - - Select - - Select - - Select - External…

Answer 1

Question

Chapter 13, Problem 16E

a)

To determine

Identify the cost of quality classification for each activity.

b)

To determine

Prepare the cost of quality report for Company M, given the sales for the period was $4,000,000(Round percentages to one decimal place).

c)

To determine

Interpret the Cost of Quality Report of Company M.

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Quality Cost Report Evans Company had total sales of $1,500,000 for fiscal 20x5. The costs of quality-related activities are given below. Returns/allowances $90,000 Design changes 82,500 Prototype inspection 4,500 Downtime 112,500 Quality circles 4,500 Packaging inspection 3,000 Field testing 4,500 Complaint adjustment 105,000 Required: Question Content Area 1. Prepare a quality cost report, classifying costs by category and expressing each category as a percentage of sales. Round percentages to one decimal place, when rounding is required. For example, 5.78% would be entered as "5.8". Evans CompanyQuality Cost ReportFor the Year Ended 20x5 Quality Costs Total Percentage of Sales Prevention costs: $- Select - - Select - $- Select - - Select -% Appraisal costs: $- Select - - Select - - Select - - Select - Internal failure costs: $- Select - - Select - - Select - - Select - External…

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Use the information in the following table to compute each department’s contribution to overhead (both in dollars and as a percent). Which department contributes the largest dollar amount to total overhead? Which department contributes the highest percent (as a percent of sales) to total overhead? Dept. A Dept. B Dept. C Sales $ 53,000 $ 180,000 $ 84,000 Costs of goods sold 34,185 103,700 49,560 Gross profit 18,815 76,300 34,440 Total direct expenses 3,660 37,060 7,386