Activity-Based Quality Costing

Ivanov, 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	169,000	341,300
Warranty work (units)	1,720	870
Scrapped units (number)	3,410	790
Inspection (hours)	3,480	1,750
Quality training (hours)	85	85
Activities:
Performing warranty work	$841,750
Scrapping units	617,400
Inspecting	339,950
Quality training	84,150

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?