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 $29,300, whereas no. 172 typically sells for approximately $26,100. 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 $80 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 Required: No. 165 No. 172 130 130 $ 830 $ 280 60x 10% 1,530 hours 1,930 hours $1,830 $1,565 25% 265 hours 200 465 hours $28,100 $34,300 $13,60 $48,600 1. Classify the preceding costs as prevention, appraisal, Internal failure, or external failure. 2-a. Using the classifications in requirement 1, compute AT's quality costs for machine no. 165 in dollars and as a percentage of sales revenues. 2-b. Using the classifications In requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 3-a. Using the classifications in requirement 1, compute AT's quality costs for machine no. 172 in dollars and as a percentage of sales revenues. 3-b. Using the classifications In requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 4. Is the company "Investing" its quality expenditures differently for the two machines? Required: 1. Classify the preceding costs as prevention, appraisal, Internal failure, or external failure. 2-a. Using the classifications in requirement 1, compute AT's quality costs for machine no. 165 In dollars and as a percentage of sale revenues. 2-b. Using the classifications In requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 3-a. Using the classifications In requirement 1, compute AT's quality costs for machine no. 172 In dollars and as a percentage of sales revenues. 3-b. Using the classifications In requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 4. Is the company "Investing" its quality expenditures differently for the two machines? Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 28 Req 3A Req 38 Req 41 Classify the preceding costs as prevention, appraisal, internal failure, or external failure. Warranty costs Reliability engineering Rework at AT's manufacturing plant Manufacturing inspection Transportation costs to customer sites Quality training for employees 1. Classify the preceding as pro 2-a. Using the classifications In requirement 1, compute AT's quality costs for machine no. 165 In dollars and as a percentage of sales revenues. 2-b. Using the classifications In requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 3-a. Using the classifications in requirement 1, compute AT's quality costs for machine no. 172 In dollars and as a percentage of sales revenues. 3-b. Using the classifications In requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 4. Is the company "Investing" Its quality expenditures differently for the two machines? Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 28 Req 3A Req 38 Req 4 Using the classifications in requirement 1, compute AT's quality costs for machine no. 165 in dollars and as a percentage of sales revenues. (Round "Percentage of Sales" to 2 decimal places.) No. 165 Dollars Percentage of Sales Total S 0 Total $ Total quality costs 15 0.00% 1. Classify the preceding costs as prevention, appraisal, Internal failure, or external failure. 2-a. Using the classifications in requirement 1, compute AT's quality costs for machine no. 165 In dollars and as a percentage of sales revenues. 2-b. Using the classifications In requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 3-a. Using the classifications in requirement 1, compute AT's quality costs for machine no. 172 in dollars and as a percentage of sales revenues. 3-b. Using the classifications In requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 4. Is the company "Investing" its quality expenditures differently for the two machines? Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 2 Req 3A Req 38 Req 4 Using the classifications in requirement 1, compute AT's prevention, appraisal, internal failure, and external failure costs as a percentage of total quality costs. (Round "Percentage of Total Quality Costs" to 2 decimal places. Total may not be equal to 100% due to rounding.) Prevention Appraisal Internal failure External failure Total No. 165 Dollars Percentage of Total Quality Costs % % % $ 3-a. Using the classifications In requirement 1, compute AT's quality costs for machine no. 172 In dollars and as a percentage of sales revenues. 3-b. Using the classifications In requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 4. Is the company "Investing" its quality expenditures differently for the two machines? Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 28 Req 3A Req 38 Req 4 Using the classifications in requirement 1, compute AT's quality costs for machine no. 172 in dollars and as a percentage of sales revenues. (Round "Percentage of Sales" to 2 decimal places.) No. 1724 Dollars Percentage of Sales Total S 0 Total $ Total quality costs $ 0 0.00 % 3-b. Using the classifications in requirement 1, compute AT's prevention, appraisal, Internal failure, and external failure costs as a percentage of total quality costs. 4. Is the company "Investing" its quality expenditures differently for the two machines? Complete this question by entering your answers in the tabs below. Req 1 Req 2A Req 28 Req 3A Req 381 Req 4 Using the classifications in requirement 1, compute AT's prevention, appraisal, internal failure, and external failure costs as a percentage of total quality costs. (Round "Percentage of Total Quality Costs" to 2 decimal places. Total may not be equal to 100% due to rounding.) No. 172 Prevention Appraisal Internal failure Extemal failure Total Dollars Percentage of Total Quality Costs % % % % S 01