REQUIRED:

A. Prepare a cost of quality report for the two models under their quality cost classification. (10 Marks)

B. Comment on the above analysis in terms of the companys quality investment expenditures relating the two models. (5 Marks)

C. Discuss the difference between non-value adding activities and business process reengineering with examples relating to the above scenario in the question. (5 Marks)

Skyline Machinery Limited produces two types of washing machines that are very popular among the households in Fijiana settlement. The two models of washing machine are Dry Clean Model and Wet Clean Model with a selling price of $30,000 and $27,000 respectively. The company's quality analyst is concerned about issues in performance in terms of its quality due to a number of customer complaints received. The analyst then collected the following information for analysis: Dry Clean Model Wet Clean Model Number of washing machines produced and sold 160 200 Warranty Costs: Average repair cost per unit Percentage of units needing repairs $900 $350 70% 10% Reliability Engineering at $150 per hour 1600 Hours 2000 Hours Rework at the Manufacturing plant: Rework cost per unit Percentage of units needing rework $1,900 35% $1,600 25% Manufacturing inspection at $50 per hour 300 Hours 500 Hours Transportation cost to cutomer sites to fix machines $29,500 $15,000 Quality training for employees $35,000 $50,000