Mercury, Incorporated Quality Cost Report (in thousands) Last Year Percentage of Amount Total Production Cost Total Quality Percentage of Amount Total Production Cost Cost This Year Percentage of Percentage of Total Quality Cost Prevention costs: Machine maintenance Training suppliers 380 4 Quality circles 26 Total prevention costs 410 $ 140 15 90 245 Appraisal costs: Incoming inspection 45 22 Final testing 160 90 Total appraisal costs 205 112 Internal failure costs: Rework 120 72 Scrap 76 60 Total internal failure costs 196 132 External failure costs: Warranty repairs 65 29 Customer returns 262 89 Total external failure costs 327 118 Total quality cost 1,138 607 Total production cost 4,280 $ 4,680