Seven Seas Inc. provides cable TV and Internet service to the local community. The activities and activity costs of Seven Seas are identified. a. Identify the cost of quality classification for each activity and whether the activity is value-added or non-value-added. Quality Control Activities Billing error correction Activity Cost $35,000 Cable signal testing 84,800 Reinstalling service (Installed Incorrectly the first time) 75,200 Repairing satellite equipment 26,500 Repairing underground cable connections to the customer 22,700 Replacing old technology cable with higher quality cable 102,400 Replacing old technology signal switches with higher quality switches 117,000 Responding to customer home repair requests 42,000 Training employees 24,400 Total activity cost $530,000 Quality Cost Classification VA/NVA Classification b. Prepare a cost of quality report. Assume that sales are $2,120,000. If required, round percentages to one decimal place. Quality Cost Classification Prevention Appraisal Internal failure External failure Total Seven Seas Inc. Cost of Quality Report Quality Cost Percent of Total Quality Cost Percent of Total Sales % % % % % % % % % % c. Prepare a value-added/non-value-added analysis. If required, round percentages to one decimal place. Seven Seas Inc. Value-Added/Non-Value-Added Category Value-added Activity Analysis Non-value-added Total Amount Percent % % % d. What percentage of total costs of quality are considered to be value-added?