3 El 24A Prepare a Cost of Quality Report The CEO of Salty Snackfoods is concerned about the amount of resources currently spent on customer warranty claims. Each box of snacks is printed with the guarantee "Satisfact guaranteed or your money back." Since the claims are so high, she would like to evaluate what costs are being incurred to ensure the quality of the product. The following informatica was collected from various departments within the company: $400,000 Warranty claims......... Cost of defective products found at the inspection point... 94,000 Training factory personnel...... 26,000 Recall of Batch #59374 175,000 Inspecting products halfway through the production process 55,000 Cost of disposing of rejected products......... 12,000 Preventive maintenance on factory equipment. 7,000 Production loss due to machine breakdowns... 15,000 Inspection of raw materials. 5,000 Requirements 1. Prepare a Cost of Quality Report. In addition to listing the costs by category, determine the percentage of the total costs of quality incurred in each cost category. 2. Do any additional subjective costs appear to be missing from the report? 3. What can be learned from the report? E1125A Classify costs and make a quality-initiative decision (Learning Objective 7) Chihooli manufactures radiation-shielding glass panels. Suppose Chihooli is considering spending the following amounts on a new TQM program: Strength-testing one item from each batch of panels $65,000 Training employees in TQM.... 30,000 Training suppliers in TQM..... 40,000 Identifying preferred suppliers who commit to on-time delivery of perfect quality materials 60,000 Chihooli expects the new program to save costs through the following: Avoid lost profits from lost sales due to disappointed customers Avoid rework and spoilage $90,000 Avoid inspection of raw materials 55,000 Avoid warranty costs... 45,000 15,000 Requirements 1. Classify each item as a prevention cost, an appraisal cost, an internal falturno external failure cost 2. Should Chinooll implement the