b. Prepare a cost of quality report. Assume that the sales for the period were $4,000,000. If required, round percents to one decimal place. Meagher Solutions Inc. Cost of Quality Report Quality Cost Percent of Total Percent of Quality Cost Classification Quality Cost Total Sales Prevention % % Appraisal % % Internal failure % % External failure Jo Jo % % % % Total Cost of Quality Report Meagher Solutions Inc. manufactures memory chips for personal computers. An activity analysis was conducted, and the following activity costs were identified with the manufacture and sale of memory chips: a. Identify the cost of quality classification for each activity. Quality Activities Activity Cost Quality Cost Classification Correct shipment errors $150,000 External failure Disposing of scrap 95,000 Internal failure Emergency equipment maintenance 125,000 Internal failure Employee training 50,000 Prevention Final inspection 80,000 Appraisal Inspecting incoming materials 60,000 Appraisal Preventive equipment maintenance 40,000 Prevention Processing customer returns 90,000 External failure Scrap reporting 45,000 Internal failure Supplier development Warranty claims Total 15,000 Prevention 250,000 External failure $1,000,000