Harvey Company designs and produces surgical lasers. Its product is brilliantly designed, but the manufacturing process has been plagued by chronic quality control problems. To help address the situation, Harvey formed a cross$-$functional team of managers that quantified its costs of quality over the last two quarters as follows:

Costs $($in thousands$)$

Quarter $1$ Quarter $2$

Cost of testing equipment $$270$ $$390$

Customer returns of defective goods $$3,200$ $$200$

Downtime due to quality problems $$600$ $$1,100$

Inspection $$1,700$ $$2,770$

Net cost of scrap $$800$ $$1,300$

Product recalls $$3,500$ $$600$

Quality engineering $$1,080$ $$1,650$

Rework labor $$1,400$ $$1,600$

Statistical process control $$0$ $$270$

Supplies used in testing $$30$ $$40$

Systems development $$120$ $$680$

Warranty repairs $$3,300$ $$2,800$

The company$$s sales were $$95$ million in Quarter $1$ and $$100$ million in Quarter $2.$

create a stacked bar chart that includes a total of two bars$$one for each quarter. Each bar should quantify that quarter$$s total quality costs as well as the portion of those costs that fall within each of the four quality cost categories $($i$.$e$.,$ prevention, appraisal, internal failure, and external failure$).$

Based on a review of your bar chart, answer the following questions:

Note: Enter your answers in thousands.

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b$-1.$ From quarter $1$ to quarter $2,$ the external failure costs by

b$-2.$ From quarter $1$ to quarter $2,$ the prevention costs by

b$-3.$ From quarter $1$ to quarter $2,$ the internal failure costs by

create a stacked bar chart that includes a total of two bars$$one for each quarter. Each bar should quantify that quarter$$s total quality costs as a percent of that quarter$$s sales. It should also depict each of the four quality cost categories $($i$.$e$.,$ prevention, appraisal, internal failure, and external failure$)$ as a percent of sales.

Based on a review of your bar chart, answer the following questions:

Note: Round your answers to $2$ decimal places.

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c$-1.$ From quarter $1$ to quarter $2,$ the appraisal costs as a percent of sales by $\%$

c$-2.$ From quarter $1$ to quarter $2,$ the external failure costs as a percent of sales by $\%$

c$-3.$ From quarter $1$ to quarter $2,$ the prevention costs as a percent of sales by $\%$

$4.$ Based on a review of the quality cost report and the bar graphs you created in Parts $1$ through $3$ of this exercise, which of the following statements is true?

multiple choice

$$ The total cost of quality declined from the first quarter to the second quarter.

$$ The external failure costs as a percent of the total cost of quality increased from the first quarter to the second quarter.

$$ The prevention and appraisal costs both decreased from the first quarter to the second quarter.