5e sol14-10

5e sol14-10 - Training $6,000 $3,750 $2,250 U Supplier...

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Cost Management Hansen and Mowen Ex 14-10 Name: SOLUTION Enter the appropriate amounts in the shaded cells in columns E and G. 1) Total quality costs, 2006 $110,000 Less: Total quality costs, 2007 81,000 Increase in profits $29,000 2) Total quality costs in 2012 Sales x Quality cost % $750,000 2.5% = $18,750 Distribution of quality costs at 2012 Total quality costs x distribution % Scrap $18,750 15.0% = $2,812.50 Training $18,750 20.0% = 3,750.00 Supplier evaluation $18,750 25.0% = 4,687.50 Test labor $18,750 25.0% = 4,687.50 Inspection $18,750 15.0% = 2,812.50 Total $18,750.00 Tru-Lite Frozen Desserts Long-Range Performance Report For the Year Ended December 31, 2007 Actual Costs Long-Range 2007 Target Costs Variance Prevention costs: Based on $750,000 sales
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Unformatted text preview: Training $6,000 $3,750 $2,250 U Supplier evaluation 13,000 4,688 8,312 U Total prevention $19,000 $8,438 $10,562 U Appraisal costs: Test labor $8,000 $4,687 $3,313 U Inspection labor 24,000 2,813 21,187 U Total appraisal $32,000 $7,500 $24,500 U Internal failure costs: Scrap $15,000 $2,812 $12,188 U Rework 10,000 - 10,000 U Total internal failure $25,000 $2,812 $22,188 U External failure costs: Consumer complaints $5,000 $- $5,000 U Lost sales- - - Total external failure $5,000 $- $5,000 U Total quality costs $81,000 $18,750 $62,250 U Percentage of actual sales 10.8% 2.5% 8.3% 4) Total quality costs, 2007 $96,500 Total quality costs, 2012 18,750 Increase in profits $77,750...
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This note was uploaded on 12/02/2009 for the course ACC 202 taught by Professor Scottcohen during the Spring '09 term at NC Wesleyan.

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