MyLab Accounting with Pearson eText -- Access Card -- for Horngren's Cost Accounting
16th Edition
ISBN: 9780134476384
Author: Srikant M. Datar, Madhav V. Rajan
Publisher: PEARSON
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Textbook Question
Chapter 19, Problem 19.30P
Quality improvement, Pareto diagram, cause-and-effect diagram. Pauli’s Pizza has recently begun collecting data on the quality of its customer order processing and delivery. Pauli’s made 1,800 deliveries during the first quarter of 2017. The following quality data pertain to first-quarter deliveries:
| Type of Quality Failure | Quality Failure Incidents, First Quarter 2017 |
| Late delivery | 50 |
| Damaged or spoiled product delivered | 5 |
| Incorrect order delivered | 12 |
| Service complaints by customer of delivery personnel | 8 |
| Failure to deliver incidental items with order (drinks, side items, etc.) | 18 |
- 1. Draw a Pareto diagram of the quality failures experienced by Pauli’s Pizza.
Required
- 2. Give examples of prevention activities that could reduce the failures experienced by Pauli’s.
- 3. Draw a cause-and-effect diagram of possible causes for late deliveries.
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Students have asked these similar questions
Each day, a FedEx competitor processes approximately 50,000 shipments. Suppose that they use the same Service Quality Index as FedEx and identified the following numbers of errors during a 5-day week (see the "FedEx: Measuring Service Performance" box). These values are hypothetical and do not reflect any real company’s actual performance.
Description
Weight
Number of Errors
Complaints reopened
3
130
Damaged packages
10
19
International
1
107
Invoice adjustments
1
282
Late pickup stops
3
200
Lost packages
10
3
Missed proof of delivery
1
28
Right date late
1
751
Traces
3
111
Wrong day late
5
16
Compute the Service Quality Indicator by finding the weighted sum of errors as a percentage of total shipments. Do not round intermediate calculations. Round your answer to three decimal places.
Service Quality Indicator (SQI): %
Cost of Quality Report
A quality control activity analysis indicated the following four activity costs of a hotel:
Inspecting cleanliness of rooms
$56,000
Processing lost customer reservations
28,000
Rework incorrectly prepared room service meal
84,000
Employee training
112,000
Total
$280,000
Sales are $1,400,000. Prepare a cost of quality report. Round percent of sales to one decimal place.
Cost of Quality Report
Quality Cost Classification
Quality Cost
Percent of Total Quality Cost
Percent of Total Sales
Prevention
?
?
?
Appraisal
?
?
?
Internal failure
?
?
?
External failure
?
?
?
Total
?
?
?
Rizzo Goal Inc. produces and sells hockey equipment, often custom made for online orders. The company has the following performance metrics on its balanced scorecard: days from ordered to delivered, number of shipping errors, customer retention rate, and market share. A measure map illustrates that the days from ordered to delivered and the number of shipping errors are both expected to directly affect the customer retention rate, which affects market share. Additional internal analysis finds that:
Every shipping error over 2 shipping errors per month reduces the customer retention rate by 1.5%.
On average, each day above 2 days from ordered to delivered yields a reduction in the customer retention rate of 1%.
Each day before 2 days from order to delivery yields an increase in the customer retention rate of 1%, on average.
Rizzo Goal Inc.’s current customer retention rate is 75%.
The company estimates that for every 1% increase or decrease in the customer retention rate, market share…
Chapter 19 Solutions
MyLab Accounting with Pearson eText -- Access Card -- for Horngren's Cost Accounting
Ch. 19 - Describe two benefits of improving quality.Ch. 19 - Prob. 19.2QCh. 19 - Name two items classified as prevention costs.Ch. 19 - Give two examples of appraisal costs.Ch. 19 - Distinguish between internal failure costs and...Ch. 19 - Describe three methods that companies use to...Ch. 19 - Companies should focus on financial measures of...Ch. 19 - Give two examples of nonfinancial measures of...Ch. 19 - Give two examples of nonfinancial measures of...Ch. 19 - When evaluating alternative ways to improve...
Ch. 19 - Distinguish between customer-response time and...Ch. 19 - Prob. 19.12QCh. 19 - Give two reasons why delays occur.Ch. 19 - Companies should always make and sell all products...Ch. 19 - Prob. 19.15QCh. 19 - Rector Corporation is examining its quality...Ch. 19 - Six Sigma is a continuous quality improvement...Ch. 19 - Costs of quality. (CMA, adapted) Osborn, Inc.,...Ch. 19 - Costs of quality analysis. Adirondack Company...Ch. 19 - Costs-of-quality analysis. Safe Travel produces...Ch. 19 - Costs of quality, quality improvement. iCover...Ch. 19 - Prob. 19.22ECh. 19 - Prob. 19.23ECh. 19 - Waiting time. Its a Dogs World (IDW) makes toys...Ch. 19 - Waiting time, service industry. The registration...Ch. 19 - Waiting time, cost considerations, customer...Ch. 19 - Nonfinancial measures of quality and time. For the...Ch. 19 - Nonfinancial measures of quality, manufacturing...Ch. 19 - Statistical quality control. Harvest Cereals...Ch. 19 - Quality improvement, Pareto diagram,...Ch. 19 - Quality improvement, relevant costs, and relevant...Ch. 19 - Quality improvement, relevant costs, and relevant...Ch. 19 - Waiting times, manufacturing cycle times. The...Ch. 19 - Prob. 19.34PCh. 19 - Manufacturing cycle times, relevant revenues, and...Ch. 19 - Compensation linked with profitability, waiting...Ch. 19 - Ethics and quality. Weston Corporation...Ch. 19 - Prob. 19.38P
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