Question
Exercise 12-8 (Algo) Cost of Quality [LO12-2] Walton Company has measured its quality costs for the past two years. After the company gathers its
Exercise 12-8 (Algo) Cost of Quality [LO12-2] Walton Company has measured its quality costs for the past two years. After the company gathers its quality cost data, it summarizes those costs using the four categories shown below: Prevention costs Appraisal costs. Internal failure costs External failure costs Required: Last Year $ 392,700 $ 413,900 $ 821,600 $ 1,122,000 This Year $ 708,500 $550,500 $ 465,000 $ 632,400 1. Calculate the total cost of quality last year and this year. 2. For last year, calculate the cost in each of the four categories as a percent of the total cost of quality. 3. For this year, calculate the cost in each of the four categories as a percent of the total cost of quality. 4-a. Calculate the change in total cost of quality over the two-year period. 4-b. Is performance trending in a favorable or unfavorable direction?
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