purchased from two local suppliers: Traynor Inc. and Bello Company. Both suppliers are reliable and rarely deliver late; however, Traynor sells the componer for P10.00 per unit and Bello sells the same component for P8.95. Hamilton purchases 70 percent of its components from Bello, because of the lower price. The total annual demand is 75,000 units. I. Activity Data Inspecting components (sampling only) Reworking products (due to failed component) Warranty work (due to failed component) II. Supplier Data Activity Cost P 190,000 P2,254,000 P1,723,000 Traynor Bello Inc. Company Unit Purchase Price P10.00 P8.95 Units Purchased Sampling Hours Rework hours Warranty hours 22,500 52,500 50 50 2,450 135 3,625 475 6,000 Suppose that Hamilton loses P2,500,000 in sales per year because of its reputation for defective units attributable to failed components. Using warranty hours, assign the proportional cost of lost sales to Bello Company. Then determine what effect this would have on the cost ner component.