Interim Quality Performance Report

Davis, Inc., had the following quality costs for the years ended December $31,20$x$4$ and $20$x$5$:

$20$x$420$x$5$

Prevention costs:

Quality audits $$74,000$ $$111,000$

Vendor certification $118,500177,750$

Appraisal costs:

Product acceptance $$87,000$ $$130,500$

Process acceptance $97,000102,500$

Internal failure costs:

Retesting $$104,000$ $$84,000$

Rework $200,000170,000$

External failure costs:

Recalls $$142,500$ $$114,000$

Warranty $305,000294,000$

At the end of $20$x$4,$ management decided to increase its investment in control costs by $50$ percent for each category's items with the expectation that failure costs would decrease by $20$ percent for each item of the failure categories. Sales were $$12,000,000$ for both $20$x$4$ and $20$x$5.$

Required:

Question Content Area

$1.$ Calculate the budgeted costs for $20$x$5.$