Abrams Corporation incurred the following quality costs during the year: Inspections $ 35,400 Training $ 16,700 Quality planning $7,000 Maintenance $10,800 Rework $ 3,850 Warranty $8,690 Testing of equipment $8,000 Scrap $8,000 Lost sales $ 20,600 Downtime $ 10,400 Repairs $ 7,200 What are the total internal failure costs for the Abrams Corporation ?

Abrams Corporation incurred the following quality costs during the year: Inspections $ 35,400 Training $ 16,700 Quality planning $7,000 Maintenance $10,800 Rework $ 3,850 Warranty $8,690 Testing of equipment $8,000 Scrap $8,000 Lost sales $ 20,600 Downtime $ 10,400 Repairs $ 7,200 What are the total internal failure costs for the Abrams Corporation ?

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 5CE: Verde Company reported operating costs of 50,000,000 as of December 31, 20x5, with the following...

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SHERA Corporation incurred the following quality costs for the year ended 2024: Cost of quality training $10,569 Cost of rework labor and overhead $14,498 Cost of field servicing $12,905 Cost of recalled product $10,209 Downtime due to rework $10,018 Product testing $11,289 Inspection of goods $13,920 Warranty replacements $14,348 Quality engineering $12,244 Determine the total prevention cost.
Raeann Company incurred the following costs during the current year: Modification to the formulation of a chemical product. 1,350,000 Trouble-shooting of breakdowns during commercial production. 1,500,000 Design of tools, jigs and dies involving new technology. 1,700,000 Seasonal or other periodic design changes to existing products. 1,850,000 Laboratory research aimed to discovery of new technology. 2,150,000 In the income statement for the current year, what amount should be reported as research and development expense? A. 5,200,000 B. 4,700,000 C. 3,850,000 D. 3,350,000
Red Company reported sales of $8,100,000 in 2010. At the end of the year, the following quality costs were reported: Design review $405,000; Recalls 135,000; Reinspection 67,500; Materials inspection 54,000; Quality training 135,000; Process acceptance 67,500; Scrap 47,250; Lost sales 270,000; Product inspection 40,500; Returned goods 128,250. REQUIRED: 1.Compute for the total external failure costs 2.compute for the total prevention costs.
Western Wholesale Foods incurs the following expenditures during the current fiscal year. How should Western account for each of these expenditures? 1. Salaries for the repair technicians, $156,000 2 Remodeling of the executive offices, $80,300 3 Annual maintenance costs related to its machinery, $77,300 4 Improvement of the production line resulting in an increase in productivity, $31,100 S. Addition of a sprinkler system to the manufacturing facility to reduce the risk of fire damage, $44.400
A. Jennifer incurs the following quality costs: $17,000 on systems development $8,000 on the depreciation of test equipment $102,000 on warranty repairs $27,000 on the net cost of scrap $16,000 on the net cost of spoilage $77,000 on audits of the effectiveness of the quality system. What are the total internal failure costs? B. Tyler's Inc. makes soap. Tyler plans to produce 5000 soaps next month. 5000 soaps require 3000 tons of detergent at the cost of $11 a ton. Tyler also estimates the need for 1O workers to work 8 hours a day to meet the next month's production target. The current labor rate is $16.50/hr. Tyler estimates fixed manufacturing overhead cost to be $42,000 for the year and variable manufacturing overhead to be $15 per labor hour. The company plans to sell the soaps for $27 each. What is the total prime cost incurred by Tyler for the next month? (Assume the month has 30 days)
The manager at East Coast Manufacturing organizes costs to prepare the Costs of Quality report. The manger compiled the following data: Employee training $156,000 $205,000 Warranty costs $251,000 $170,000 Rework Product testing Cost of rejected units $30,000 $25,000 $760,000 $100,000 Sales return processing costs Lost profits from lost sales Inspection at State I of Production Preventative maintenance $95,000 Improved equipment $145,000 What of the following cost is the total cost of quality the manager should use to report the costs in the internal failure cost category? O A. $251,000 O B. $602,000 C. $281,000 O D. $170,000 O E. $205,000
At the beginning of the year, Cinnabar Company initiated an environmental cost reduction program. To help assess the impact of the environmental cost reduction improvement program, the following data were collected for the year: Operating costs $2,500,000 Designing products 2,500 Auditing environmental activities 6,000 Recycling products 22,000 Disposing of toxic waste 37,000 Testing for contamination 15,000 Cleaning up oil spills 41,500 Which of the following expresses the environmental costs incurred on prevention activity as a percentage of operating costs (rounded to two decimal places)? a. 0.98% b. 0.15% c. 2.46% d. 4.96%
An industrial company has (20) machines, and every malfunction that costs the company 180 dinars to be repaired includes repair costs and maintenance services. In addition to (0.10) of the working time for each working day, noting that each delay for one working day costs the company (8000) dinars, and the company responsible for the preventive maintenance program provided it after the daily working hours at a cost of (300) dinars per machine, and thus loss can be avoided. The working day, and the holidays possibilities have been estimated as shown in the following table: Required: 1- Calculating the cost of repairing the malfunction during work (remedial maintenance) 2- Calculating the cost of a preventive maintenance policy or program if it is followed every month, and if it is followed every three months. 3- Determine what is best for the company? Do you choose a curative maintenance policy or preventive maintenance? By the body in charge of this?…
Using the Taguchi quality loss function, an average loss of 20 per unit is calculated. During the year, 25,000 units were produced. Which of the following statements represents the correct application of the Taguchi loss function? a. The hidden costs of internal failure are 500,000. b. The hidden costs of external failure are 500,000. c. The costs of detection activities are 20 per unit inspected. d. The total external costs are 500,000.
Verde Company reported operating costs of 50,000,000 as of December 31, 20x5, with the following environmental costs: Required: 1. Prepare an environmental cost report, classifying costs by quality category and expressing each as a percentage of total operating costs. What is the message of this report? 2. Prepare a pie chart that shows the relative distribution of environmental costs by category. What does this report tell you? 3. What if Verde deliberately did not include the cost of damaging the ecosystem because of solid waste disposal in its environmental cost report? Offer possible reasons for this decision. If consciously avoided, is this decision unethical?
1. Connie Company incurred the following costs during the current year: Design of tools, jigs, molds and dies involving new technology. 2,500,000 Modification of the formulation of process. 3,200,000 Trouble-shooting in connection with breakdowns during commercial production 2,000,000 Adaptation of an existing capability to a particular customer’s need as part of a continuing commercialactivity. 2,200,000 What amount should be reported as research and development expense for the current year?A. 2,500,000 B. 3,200,000 C. 4,700,000 D. 5,700,000
Cody Corp. incurred the following costs during 2006: Design of tools, jigs, molds, and dies involving new technology $125,000 Modification of the formulation of a process 160,000 Troubleshooting in connection with breakdowns during commercial production 100,000 Adaption of an existing capability to a particular customer's need as part of a continuing commercial activity 110,000 In its 2006 income statement, Cody should report research and development expense of O $160,000 O $285,000 O $125,000 O $235,000