After the first meeting of the task force, Holly Elsoe, manager of the Marketing Department, asked John Tran, production manager what he thought of the proposed program. Tran replied, I have reservations. Quality is too abstract to be attaching costs to it and then to be holding you and me responsible for cost improvements. I like to work with goals that I can see and count! I'm nervous about having my annual bonus based on a decrease in quality costs; there are too many variables that we have no control over. Mercury's quality improvement program has now been in operation for one year. The company's most recent quality cost report is shown below Mercury, Inc Quality Cost Report (in thousands) Last Year This Year Prevention costs: Machine maintenance Training suppliers Quality circles Total prevention cost Appraisal costs: Incoming inspection Final testing Total appraisal cost Internal failure costs: Rework Scrap Total internal failure cost External failure costs: Warranty repairs Customer returns Total external failure cost $70120 10 20 150 70 20 80 100 40 130 50 40 90 130 70 200 30 80 110 $ 670 590 90 320 410 Total quality cost Total production cost 4,200 4,800 As they were reviewing the report, Elsoe asked Tran what he now thought of the quality improvement program. Tran replied. "I'm relieved that the new quality improvement program hasn't hurt our bonuses, but the program has increased the workload in the Production Department. It is true that customer returns are way down, but the cell phones that were returned by customers to retail outlets were rarely sent back to us for rework." Required: 1. Expand the company's quality cost report by showing the costs in both years as percentages of both total production cost and total quality cost. (Round your percentage answers to 1 decimal place (i.e 0.1234 should be entered as 12.3).) Mercury, Inc. Quality Cost Report in thousands) Last Year This Year Percentage of Amount Total Production Percentage of Percentage of Total Quality Amount Total Production Total Quality Cost Cost Cost Prevention costs: 120 Machine maintenance Training suppliers Quality circles 10 Total prevention costs 70 0.0 0.0 150 0.0 0.0 Appraisal costs: Incoming inspection Final testing 20 100 0.0 Total appraisal costs Internal failure costs: 0.0 0.0 130 0.0 130 Total internal failure costs 0.0 0.0 0.0 0.0 External failure costs: Warranty repairs Customer returns Total external failure costs Total quality cost Total production cost 320 410 670 4,200 0.0 0.0 0.0 0.0$ 0.0 0.0 0.0 0.0 110 $4,800