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. Activity Quality Activities Quality Cost Classification Cost Correct shipment errors $150,000 Appraisal X Disposing of scrap 95,000 Appraisal X Emergency equipment maintenance 125,000 Appraisal x Employee training 50,000 Appraisal X Final Inspection 80,000 Appraisal Inspecting incoming materials 60,000 Appraisal Preventive equipment maintenance 40,000 Appraisal x Processing customer returns 90,000 Appraisal X Scrap reporting 45,000 Appraisal x Supplier development 15,000 Appraisal x Warranty claims 250,000 Appraisal x Total $1,000,000 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 Percent of Total Quality Cost Quality Cost Quality Cost Classification Percent of Total Sales Prevention % % Appraisal % % Internal failure % % % % External failure % % Total Feedback Check My Work b. Classify each activity as either prevention, appraisal, internal failure or external failure. List the total costs of each of these four categories in a column called quality cost. In a separate column, determine the percent of each cost as compared to the total costs by dividing individual quality cost categories by the total quality costs. In Check My Work b. Classify each activity as either prevention, appraisal, internal failure or external failure. List the total costs of each of these four categories in a column called quality cost. In a separate column, determine the percent of each cost as compared to the total costs by dividing individual quality cost categories by the total quality costs. In another column, determine the percent of each quality cost classification as compared to total sales by dividing individual quality costs classes by the total sales amount. Total all columns. Remember that the Percent of total quality costs column should total to 100%. c. The category with the fewest number of quality activities is Nearly fifty percent of the quality activity costs are . The highest single costy which is an Disposing of scrap, emergency equipment maintenance, and scr internal failures external failures Feedback prevention costs Check My Work appraisal costs C. Remember that companies use activity analysis to identify the costs of quality, which include prevention, appraisal, internal failure, and external failure costs. Feedback Check My Work Partially correct