45. (Pareto analysis) Leading Edge Computers has identified the following failure costs during 2000:

c. Focusing on the models identified in part (b), prepare a table using Pareto analysis to identify the types of failure causing the majority of failure costs.
(Hint: Rearrange the cost of failure types in descending order of magnitude.)
Use the following headings for your table:
Failure Type Dollars Percentage of Total Cumulative Percentage of Total

d. Describe the problem areas for which to seek preventive measures first.
How, if at all, does this answer reflect the concept of leverage?

Transcribed Image Text:

COST OF TYPE OF FAILURE Model CPU Internal Drive External Drive All Other Total Laptop Desktop $ 8,000 7,000 $ 7,000 $ 5,000 $ 3,000 $23,000 6,000 12,000 5,000 30,000 Mini Total 3,000 $18,000 1,000 $14,000 8,000 $25,000 3,000 15,000 $11,000 $68,000 a. Rearrange the rows in descending order of magnitude based on the total dollars column and prepare a table using Pareto analysis with the follow- ing headings: Model Dollars Percentage of Total Cumulative Percentage of Total b. Which models account for almost 80 percent of all failure costs?