Lager Corp. produces and supplies an automotive product of mechanisms used to adjust the positions of front seating units. Several competitors have recently entered the market, and management is concerned that the quality of the companys current product may be surpassed by the quality of the new competitors products. The controller was asked to conduct an analysis of the efforts to improve product quality over the last two years. His analysis generated the following costs of quality:

Item	2017	2018
Units manufactured and sold	600 units	1100 units
Selling price per unit	$1700	$2,200
Variable cost per unit	$900	$1,400
Customer support	$15,000	$14,000
Design review	$6,300	$30,000
Quality training	$4,000	$10,500
Final Testing and inspection	$18,400	$48,300
Warranty repairs	$12,500	$10,200
Machine maintenance	$5,000	$20,000
Scrap	$8,500	$12,000
Rework	$17,000	$20,000
Estimated lost sales from poor quality	40 units

Required:

1. Calculate cost of quality for the product classified into its four main categories for both 2017 and 2018.

2. Calculate the ratio of each cost of quality category to revenues. Compare and comment on the costs of quality for the two years.