Grayson Industries manufactures freezers. Here is some information about its "LX17" line of freezers over the past year: (Click the icon to view the information.) Read the requirements. Requirement 1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs of each category, calculate the percentage of COQ category of the total COQ. (Round the percentage to the one tenth of a percent, X.X% input field is not used in the table, leave the input field empty; do not select a label or enter a zero.) Grayson Cost of Quality Report 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 costs of quality Costs Incurred Total Costs of Percentage of Total Costs Quality of Quality (Rounded) % Data table % Requirements 1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs of each category, calculate the percentage of COQ category of the total COQ. 2. Why would the variable repair cost at the customers' home generally be higher than the "in factory" rework cost? 3. How can use of the COQ report lead to improvements in the production process or in the quality of the product itself? Print Done Number of units manufactured and sold Selling price per unit. 2,500 units 1,600 Variable manufacturing and selling costs per unit. $ 700 % Hours spent by engineers improving design.. 1,400 Testing and inspection hours per unit. . 0.5 hours Percentage of units reworked in the plant after inspection. Average variable rework costs per freezer. 4% $ 480 % Percentage of units repaired under warranty at customers' homes. Average variable repair costs at customers' homes per freezer. Estimated lost sales due to quality.reputation.. 10% 520 450 units % Design engineer's labor rate (includes benefits and payroll taxes) Inspection costs per hour. $85 per hour $80 per hour
Grayson Industries manufactures freezers. Here is some information about its "LX17" line of freezers over the past year: (Click the icon to view the information.) Read the requirements. Requirement 1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs of each category, calculate the percentage of COQ category of the total COQ. (Round the percentage to the one tenth of a percent, X.X% input field is not used in the table, leave the input field empty; do not select a label or enter a zero.) Grayson Cost of Quality Report 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 costs of quality Costs Incurred Total Costs of Percentage of Total Costs Quality of Quality (Rounded) % Data table % Requirements 1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs of each category, calculate the percentage of COQ category of the total COQ. 2. Why would the variable repair cost at the customers' home generally be higher than the "in factory" rework cost? 3. How can use of the COQ report lead to improvements in the production process or in the quality of the product itself? Print Done Number of units manufactured and sold Selling price per unit. 2,500 units 1,600 Variable manufacturing and selling costs per unit. $ 700 % Hours spent by engineers improving design.. 1,400 Testing and inspection hours per unit. . 0.5 hours Percentage of units reworked in the plant after inspection. Average variable rework costs per freezer. 4% $ 480 % Percentage of units repaired under warranty at customers' homes. Average variable repair costs at customers' homes per freezer. Estimated lost sales due to quality.reputation.. 10% 520 450 units % Design engineer's labor rate (includes benefits and payroll taxes) Inspection costs per hour. $85 per hour $80 per hour
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter12: Activity-based Management
Section: Chapter Questions
Problem 1CE: Cicleta Manufacturing has four activities: receiving materials, assembly, expediting products, and...
Related questions
Question
Transcribed Image Text:Grayson Industries manufactures freezers. Here is some information about its "LX17" line of freezers over the past year:
(Click the icon to view the information.)
Read the requirements.
Requirement 1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs of each category, calculate the percentage of COQ category of the total COQ. (Round the percentage to the one tenth of a percent, X.X%
input field is not used in the table, leave the input field empty; do not select a label or enter a zero.)
Grayson Cost of Quality Report
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 costs of quality
Costs
Incurred
Total Costs of
Percentage of Total Costs
Quality
of Quality (Rounded)
%
Data table
%
Requirements
1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs
of each category, calculate the percentage of COQ category of the total COQ.
2. Why would the variable repair cost at the customers' home generally be higher
than the "in factory" rework cost?
3. How can use of the COQ report lead to improvements in the production process
or in the quality of the product itself?
Print
Done
Number of units manufactured and sold
Selling price per unit.
2,500 units
1,600
Variable manufacturing and selling costs per unit.
$
700
%
Hours spent by engineers improving design..
1,400
Testing and inspection hours per unit. .
0.5 hours
Percentage of units reworked in the plant after inspection.
Average variable rework costs per freezer.
4%
$
480
%
Percentage of units repaired under warranty at customers' homes.
Average variable repair costs at customers' homes per freezer.
Estimated lost sales due to quality.reputation..
10%
520
450 units
%
Design engineer's labor rate (includes benefits and payroll taxes)
Inspection costs per hour.
$85 per hour
$80 per hour
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