Use the following information to answer questions 67 to 70. ECG Company has collected the following data on quantity produced, variable costs, fixed costs for its production, and cost analysis. Quantity Produced Total Variable Costs Total Fixed Costs Total Costs 0 $0 $10,000 $10,000 1,000 4,000 10,000 14,000 5,000 20,000 10,000 30,000 10,000 40,000 10,000 50,000 Question #67 What is the variable cost per unit for the ECC Company? a. $2 b. $3 c. $4 d. $5 Question #68 What is the marginal cost per unit for the ECC Company? a. $2 b. $3 c. $4 d. $5 Question #69 What is the average cost per unit at 10,000 units of production for the ECC Company? a. $2 b. $5 c. $6 d. $14 Question #70 ECC Company received a special order from a customer for 3,000 units at a price of $4.50 per unit. Should the company accept the special order when there is an excess production capacity? a. No, because the special price of $4.50 is less than the average cost of $5 b. Yes, because the special price of $4.50 is more than the variable cost of $4 c. No, more information is needed before making a decision d. Yes, the company should ask the customer for advance payment to cover the additional risk Use the following information to answer questions 71 to 77. The quality and accounting departments of ZBC Manufacturing Corporation have gathered the following data about quality costs and standards. The company sales are $50 million. Its standard for the total costs of quality as a percentage of sales is 4 percent while the industry average is 3.5 percent. Product liability lawsuits Warranty claims $800.000 220,0000 Rework costs 600,000 Waste 300,000 Product quality audits 475,000 Quality training 350,000 Inspection of incoming materials 900,000 Statistical process control 650,000 Design and engineering costs 100,000 Total costs $4,395,000 Question #71 What are the total prevention costs for the ZBC Manufacturing Corporation? a. $1,300,000 b. $1,100,000 c. $2,000,000 d. $2,100,000 Question #72 What are the total appraisal costs for the ZBC Manufacturing Corporation? a. $1,375,000 b. $1,595,000 c. $1,695,000 d. $1,995,000 American Institute for Business Management and Communication. All rights reserved. CPIM Certification Exam/December 2023 Question #73 What are the total internal failure costs for the ZBC Manufacturing Corporation? a. $650,000 b. $900,000 c. $695,000 d. $795,000 Question #74 What are the total external failure costs for the ZBC Manufacturing Corporation? a. $1,370,000 b. $1,470,000 c. $1,000,000 d. $1,020,000 Question #75 What is the first step you would take for the ZBC Manufacturing Corporation? a. Reduce prevention costs b. Reduce appraisal costs c. Reduce internal failure costs d. Reduce external failure costs Question #76 How do you increase the overall return on quality for the ZBC Manufacturing Corporation? a. Increase investment in prevention efforts b. Increase investment in appraisal efforts c. Increase investment in internal failure efforts d. Increase investment in external failure efforts Question #77 Spending money on preventing quality-related problems is an example of: a. Tradeoff analysis b. Quality control analysis c. Quality assurance analysis d. Pareto analysis