At the beginning of the year, Kowalski Company initiated a quality improvement program. The program was successful in reducing scrap and rework costs. To help assess the impact of the quality improvement program, the following data were collected for the current and preceding years:

	Preceding Year	Current Year
Sales	$3,000,000	$3,000,000
Quality training	3,000	4,500
Material inspections	7,500	12,000
Scrap	60,000	45,000
Rework	120,000	75,000
Product inspection	15,000	30,000
Product warranty	105,000	82,500

For the current year, internal failure costs are what percentage of sales?

a.2.50%

b.2.90%

c.1.50%

d.4.00%