Cost of quality Elijah Electronics makes wireless headphone sets. The firm produced 31.500 wireless headphone sets during its first year of operation. At year-end, it had no inventory of finished goods. Elijah sold 29.610 units through regular market channels, but 315 of the units produced were so defective that they had to be sold as scrap. The remaining units were reworked and sold as seconds. For the year, the firm spent $168,000 on prevention costs and $84,000 on quality appraisal. There were no customer returns. An income statement for the year follows Sales Regular channe Seconds Soap Cot of goods sold Ongnal production costs Rework costs Quality prevention and appo Gumargin Selling and $5.922,000 140625 11.025 56082.650 12.013400 44100 22.000 12.309.500 $3.773070 abye konesale 1.020.000 $2.744OTO Profit before income tave a. Compute the total pre-tax profit lost by the company in its first year of operations by selling defective units as seconds or as scrap rather than selling the units through regular channels so b. Compute the total failure cost for the company in its first year $0 Compute total quality cost incurred by the company in its first year. 50