Question
Pareto Chart and Cost of Quality Report for a Manufacturing Company The president of Mission Inc. has been concerned about the growth in costs
Pareto Chart and Cost of Quality Report for a Manufacturing Company The president of Mission Inc. has been concerned about the growth in costs over the last several years. The president asked the controller to perform an activity analysis to gain a better insight into these costs. summarized as follows: Activities Activity Cost Correcting invoice errors $8,680 Disposing of incoming materials with poor quality 6,510 Disposing of scrap 30,380 Expediting late production 26,040 Final inspection 15,190 Inspecting incoming materials 4,340 Inspecting work in process 21,700 Preventive machine maintenance 15,190 Producing product 75,950 Responding to customer quality complaints 13,020 $217,000 Total The production process is complicated by quality problems, requiring the production manager to expedite production and dispose of scrap. Required: 1. On paper or in a spreadsheet program, prepare a Pareto chart for each of the activities listed above. Answer the following: What type of chart is a Pareto chart? Which activity appears first, in order from left to right?
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