1) TVS Logistics North Americans distribution center receives and breaks down bulk orders that come in from various suppliers' manufacturing facilities and ships out the products to retail customers. The firms quality costs incurred in 2020 is given below.

a) Classify the various quality costs into the different quality cost categories (prevention, appraisal, internal failure, external failure).

b) Analyze the costs/costs categories and suggest which areas the firm should address first in an effort to improve their quality.

Cost Elements	Amount
Checking outbound boxes for errors	$607,750
Quality planning	$10,625
Downtime due to conveyor/computer problems	$342,125
Packaging waste	$68,000
Incoming product inspection	$51,000
Customer complaint rework	$34,000
Correcting erroneous orders before shipping	$36,550
Quality training of associates	$25,925
Quality improvement projects	$17,425
Other waste	$36,125
Correction of typographical errors--pick tickets	$11,475

2) The specification for a Lindemanns stainless steel chimney liner requires a thickness of 7.0 mm 0.1 mm. The firms quality analyst determines that the liner process operates at a mean thickness of 7.03 mm with the standard deviation of the process being 0.01 mm.

a) Calculate the upper and the lower limits for the stainless steel chimney liner.

b) Calculate the Cp and Cpk for this process.

3) The Omnigroup stocks and sells Kipor generators. The firm gathered the following information from its Kathmandu office:

Demand = 19,500 units per year,

Ordering cost = $25.50 per order

Holding cost = $4.50 per unit per year.

The firm wants to calculate the:

a) EOQ for the Kipor generators.

b) Annual holding costs for the Kipor generators.

c) Annual ordering costs for the Kipor generators.

4) Rane Brake Linings gathered information for its brake lining components as presented in the table below. How would the firm classify these items according to an ABC classification system?

Initial Information
Part #	Unit Cost	Annual Demand
10	10	200
11	30	125
12	9	100
13	12	5000
14	50	195
15	6	300
16	100	70