In response to intense foreign competition, Florex Company has taken steps to improve the quality of its products. A summary of its quality costs (in thousands) over the past two years is given below:

	Costs (in thousands)
Last Year	This Year
Inspection	$ 765	$ 1,584
Quality engineering	$ 540	$ 675
Depreciation of test equipment	$ 630	$ 225
Rework labor	$ 1,260	$ 1,620
Statistical process control	$ 0	$ 225
Cost of field servicing	$ 1,710	$ 1,170
Supplies used in testing	$ 45	$ 81
Systems development	$ 630	$ 900
Warranty repairs	$ 4,140	$ 1,260
Net cost of scrap	$ 540	$ 1,530
Product testing	$ 900	$ 1,440
Product recalls	$ 2,700	$ 990
Disposal of production defects	$ 900	$ 900

Sales have been flat over the past few years, at $90,000,000 per year.

Required:

1. Prepare a quality cost report for this year and last year.