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Trend, Long-Range Performance Report In 20x4, Tru-Delite Frozen Desserts, Inc., instituted a quality improvement program. At the end of 20x5, the management of the corporation

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Trend, Long-Range Performance Report In 20x4, Tru-Delite Frozen Desserts, Inc., instituted a quality improvement program. At the end of 20x5, the management of the corporation requested a report to show the amount saved by the measures taken during the year. The actual sales and quality costs for 20x4 and 20x5 are as follows 20x4 20x5 Sales Scrap Rework Training program Consumer complaints Lost sales, incorrect labeling Test labor Inspection labor Supplier evaluation $600,000 $600,000 15,000 10,000 6,000 5,000 15,000 20,000 5,000 10,000 8,000 12,000 25,000 15,000 8,000 24,000 13,000 Tru-Delite's management believes that quality costs can be reduced to 2.5 percent of sales within the next five years. At the end of 20x9, Tru-Delite's sales are projected to grow to $750,000. The projected relative distribution of quality costs at the end of 20x9 is as follows: Scrap Training program Supplier evaluation Test labor Inspection labor 15% 20 25 25 15 Total quality costs 100 %

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