Problem 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 $30,000, whereas no. 172 typically sells for approximately $27,500. The company is very concemed about quality and has provided the tollowing information Na. 172 No. 165 160 Numbar of machines groducad and sol Warranty costs Awerage repair cost per unit Percentage of units needing repair Relability enginearing at $150 per ho Rework at I's manutacturing plart $900 70% 1,600 haurs $350 10% 2000 hour Average rqwork cast per unt $1,900$1,800 Parcentage of units needing rework Manutacturing irspection at $50 par hour. Transportation coets to customer sikes to fux problemS Quality training for employess Required: 35 300 hours $29 500 25% 500 hours $15,000 1. Classity the preceding costs as prevention, appraisal, intenal failure, or extemal failure 2. Using the classifications in requirement (1), compute ITT'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. 3. Repeat requirement (2) for machine no. 172. 4. Comment on your findings, noting whether the company is 'investing its quality expenditures differently for the two machines hidden. What are hidden qualty costs, and 5. Quality costs can be classified as observable or how do these costs ditter from observable costs? Step-by-step solution