uieulale the appraisal cost, internal failure cost and the out of pocket external failure cost. b) Calculate the opportunity cost associated with external failure. c) Calculate the total cost of quality d) Outline three (3) consequences of quality failure for Cosy Capsule (6 Marks) (3 Marks) (3 Marks) (2 Marks) 14 Marks Question 4 Bambi Bicycles Ltd makes bicycles and has only two products, the Tornado and the Racer. To produce the Tornado, Bambi employed assets of $2,150,000 at the beginning of the period, and $1.750,000 of assets at the end of the period. Other costs to manufacture the Tornado include: Direct materials: $665 per unit Set-up: $325 per set-up hour . .Production: $182 per machine hour In addition, general administration and selling costs total $78.500 for the period. In the current period, Bambi produced 6,300 Tornado bicycles using 655 set-up-hours and 27.500, machine hours. Bambi sold these bicycles for $1,550 each Required a) Assuming that Bambi defines investment as averag return on investment (ROI) for the Tornado division? e assets during the period, what is the (6 Marks) b) Calculate the residual income (RI) for the Tornado Division if Bambi has a required rate of return of 11.5% on investments. (4 Marks) e performance of the Tornado department's manager is evaluated on the basis of ROI. derlying issues in relation to measuring a manager's performance c) Th based on ROl and other financial measres. (4 Marks) ACCY312 WG, Final Exarm Spring, 2017 Page 3 of 4 2017 SEP 21