Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

PLEASE HELP!!! I NEED DETAILED AND CLEAR SOLUTION AND ANSWER. Industrial Technologies, Inc. (ITI), produces two compression machines that are popular with manufacturers of plastics:

PLEASE HELP!!! I NEED DETAILED AND CLEAR SOLUTION AND ANSWER.

Industrial Technologies, Inc. (ITI), produces two compression machines that are popular with manufacturers of plastics: no. 165 and no. 172. Machine no. 165 has an average selling price of $30,800, whereas no. 172 typically sells for approximately $28,300. The company is very concerned about quality and has provided the following information:

No. 165 No. 172
Number of machines produced and sold 200 220
Warranty costs:
Average repair cost per unit $940 $390
Percentage of units needing repair 75% 10%
Reliability engineering at $190 per hour 1,640 hours 2,020 hours
Rework at ITI's manufacturing plant:
Average rework cost per unit $1,920 $1,620
Percentage of units needing rework 20% 25%
Manufacturing inspection at $40 per hour 320 hours 540 hours
Transportation costs to customer sites to fix problems $30,300 $15,800
Quality training for employees $35,800 $50,400

1.Using the classifications in part (1), compute ITI's quality costs for machine no. 165 in dollars and as a percentage of sales revenues. Also calculate prevention, appraisal, internal failure, and external failure costs as a percentage of total quality costs.

2. Using the classifications in part (1), compute ITI's quality costs for machine no. 172 in dollars and as a percentage of sales revenues. Also calculate prevention, appraisal, internal failure, and external failure costs as a percentage of total quality costs

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Management Accounting Information for creating and managing value

Authors: Kim Langfield Smith, David Smith, Paul Andon, Ronald Hilton, Helen Thorne

8th edition

9781760420413 , 978-1760420406

More Books

Students also viewed these Accounting questions

Question

What degrees does the program offer?

Answered: 1 week ago

Question

14. Now reconcile what you answered to problem 15 with problem 13.

Answered: 1 week ago