Activity-Based Quality Costing

Abernathy, Inc., produces two different generators and is concerned about their quality. The company has identified the following quality activities and costs associated with the two products:

	Generator A	Generator B
Units produced	167,600	340,500
Warranty work (units)	1,720	800
Scrapped units (number)	3,390	780
Inspection (hours)	3,360	1,650
Quality training (hours)	88	88
Activities:
Performing warranty work	$819,000
Scrapping units	596,310
Inspecting	320,640
Quality training	88,528

Required:

1. Calculate the quality cost per unit for each product, and break this unit cost into quality cost categories. If required, round your answers to the nearest cent.

	Generator A	Generator B
Unit cost	$fill in the blank 1	$fill in the blank 2

Which of the two seems to have the lowest quality?