Industrial Technologies, Inc. (ITI), produces two compression machines that are popular with manufacturers of plastics: no. 165 and no. 172. Machine no. 165 has an average selling price of $30,000, whereas no. 172 typically sells for approximately $27,500. The company is very concerned about quality and has provided the following information:

	No. 165			No. 172
Number of machines produced and sold		160			200
Warranty costs:
Average repair cost per unit	$	900		$	350
Percentage of units needing repair		70	%		10	%
Reliability engineering at $150 per hour		1,600	hours		2,000	hours
Rework at ITI's manufacturing plant:
Average rework cost per unit	$	1,900		$	1,600
Percentage of units needing rework		35	%		25	%
Manufacturing inspection at $50 per hour		300	hours		500	hours
Transportation costs to customer sites to fix problems	$	29,500		$	15,000
Quality training for employees	$	35,000		$	50,000

Required:

1.	Classify the preceding costs as prevention, appraisal, internal failure, or external failure.

2. Using the classifications in part (1), compute ITI's quality costs for machine no. 165 in dollars and as a percentage of sales revenues. Also calculate prevention, appraisal, internal failure, and external failure costs as a percentage of total quality costs. (Round "Percentage of Total Quality Costs" to 2 decimal places. Total may not be equal to 100% due to rounding.) 3. Using the classifications in part (1), compute ITI's quality costs for machine no. 172 in dollars and as a percentage of sales revenues. Also calculate prevention, appraisal, internal failure, and external failure costs as a percentage of total quality costs. (Round "Percentage of Total Quality Costs" to 2 decimal places. Total may not be equal to 100% due to rounding.) .