Mercury, Incorporated, produces cell phones at its plant in Texas. A year ago, a consumer survey ranked the company$$s cell phones low in product quality. Shocked by this result, Jorge Gomez, Mercury$$s president, set up a task force to implement a formal quality improvement program. Included on this task force were representatives from the Engineering, Marketing, Customer Service, Production, and Accounting departments. After working together for a year, the task force prepared the quality cost report shown below:

Mercury, Incorporated

Quality Cost Report

$($in thousands$)$

Last Year This Year

Prevention costs:

Machine maintenance $ $80$ $ $135$

Training suppliers $025$

Quality circles $035$

Total prevention cost $80195$