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4 1.07/1.09 points awarded Scored Problem 8-39 Quality Costs: Identification and Analysis (LO 8-7) Advanced Technologies (AT) produces two compression machines that are popular
4 1.07/1.09 points awarded Scored Problem 8-39 Quality Costs: Identification and Analysis (LO 8-7) Advanced Technologies (AT) produces two compression machines that are popular with manufacturers of plastics: no. 165 and no. 172. Machine no. 165 has an average selling price of $30,100, whereas no. 172 typically sells for approximately $27,700. The company is very concerned about quality and has provided the following information: Number of machines produced and sold Warranty costs: Average repair cost per unit Percentage of units needing repair Reliability engineering at $155 per hour Rework at AT's manufacturing plant: Average rework cost per unit Percentage of units needing rework Manufacturing inspection at $40 per hour Transportation costs to customer sites to fix problems Quality training for employees No. 165 170 No. 172 200 2,010 hours $ 910 $ 360 70% 1,605 hours 10% $ 1,910 $ 1,600 30% 310 hours $15,200 $29,700 $35,100 30% 510 hours $50,100
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