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In response to intensive foreign competition, the management of Florex Company has attempted over the past year to improve the quality of its products. A

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In response to intensive foreign competition, the management of Florex Company has attempted over the past year to improve the quality of its products. A statistical process control system has been installed and other steps have been taken to decrease the amount of warranty and other field costs, which have been trending upward over the past several years. Costs relating to quality and quality control over the last two years are given below: Costs (in thousands) Last This Year Year Inspection $ 630 $ 1,008 Quality engineering $ 420 $ 756 Depreciation of test equipment 5 588 210 Rework labor $ 1,050 $ 1,260 Statistical process control 294 Cost of field servicing $ 1.26 $ 1,092 Supplies used in testing s 42 Systems development 840 840 Warranty repairs $4,200 $ 1,344 Net cost of scrap 420 $ 1,050 Product testing 840 $ 1,680 Product recalls $ 2.520 $ 1,808 Disposal of defective products 630 $ $ @ $ 42 5 $ $ $ $ $ $ 840 Sales have been flat over the past few years, at $84,000,000 per year. A great deal of money has been spent in the effort to upgrade quality, and management is anxious to see whether or not the effort has been effective. Required: 1. Prepare a quality cost report that contains data for both this year and last year (Enter amount values in thousands. Round your percentage answers to 2 decimal places (ie 01234 should be entered as 12.34).) Sales have been flat over the past few years, at $84,000,000 per year. A great deal of money has been spent in the effort to upgrade quality, and management is anxious to see whether or not the effort has been effective Required: 1. Prepare a quality cost report that contains data for both this year and last year. (Enter amount values in thousands. Round your percentage answers to 2 decimal places ().e 0.1234 should be entered as 12.34).) Florex Company Quality Cost Report Last Year Amount (in Percent of thousando) Sales This Year Amount (in Parcent of thousands) Sales Prevention costs % es Total prevention costs Appraisal costs Total praisal costs Internal folure costs Total internal failure costs External failure cost Amount (in thousands) Percent of Salos Amount (in thousands) Percent of Sales Prevention costs % Total prevention costs Appraisal costs Total appraisal costs Internal failure costs: Total internal failure costs External failure costs: Total external failure costs Total quality cost

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