Managerial Accounting
17th Edition
ISBN: 9781260247787
Author: Ray H. Garrison, Eric W. Noreen, Peter C. Brewer
Publisher: RENT MCG
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Question
Chapter 12, Problem 19P
1.
To determine
Quality cost report: A quality cost report shows the detailed description of prevention costs, appraisal costs, and the cost of internal and external failures that occurs due to the company’s current quality management efforts.
To prepare: The quality cost report of Company F.
2.
To determine
Quality cost report: The quality cost report can be used to evaluate the cost distribution in a particular year and increase or decrease in any cost component in the current year.
To prepare: A written evaluation to accompany the quality cost report.
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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:
Last Year
Inspection
$ 765
$ 1,584
$ 540
$ 675
$630
$ 225
$ 1,260
$ 1,620
$O
$ 225
$ 1,710
$ 1,170
$ 45
$ 81
$ 630
$ 900
$ 4,140
$ 1,260
$ 540
$ 1,530
$ 900
$ 1,440
$ 2,700
$ 990
Disposal of production defects $ 900
$ 900
Sales have been flat over the past few years, at $90,000,000 per year.
Required:
1. Prepare a quality cost report for this year and last year.
Quality engineering
Depreciation of test equipment
Rework labor
Costs (in thousands)
This Year
Statistical process control
Cost of field servicing
Supplies used in testing
Systems development
Warranty repairs
Net cost of scrap
Product testing
Product recalls
Chapter 12 Solutions
Managerial Accounting
Ch. 12 - Prob. 1QCh. 12 - Prob. 2QCh. 12 - Prob. 3QCh. 12 - Prob. 4QCh. 12 - Prob. 5QCh. 12 - Prob. 6QCh. 12 - Prob. 7QCh. 12 - Prob. 8QCh. 12 - Prob. 9QCh. 12 - Prob. 10Q
Ch. 12 - Prob. 1AECh. 12 - Prob. 2AECh. 12 - Prob. 1ECh. 12 - Prob. 2ECh. 12 - Prob. 3ECh. 12 - Prob. 4ECh. 12 - Prob. 5ECh. 12 - Prob. 6ECh. 12 - Prob. 7ECh. 12 - Prob. 8ECh. 12 - Prob. 9ECh. 12 - Prob. 10ECh. 12 - Prob. 11ECh. 12 - Prob. 12PCh. 12 - Prob. 13PCh. 12 - Prob. 14PCh. 12 - Prob. 15PCh. 12 - Prob. 16PCh. 12 - Prob. 17PCh. 12 - Prob. 18PCh. 12 - Prob. 19PCh. 12 - Prob. 20PCh. 12 - Prob. 21C
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