You are given the following environmental quality-related costs:

Employee training	$	180,000
Product design		220,000
Supplier certification		80,000
Process inspection		360,000
Depreciationpollution-control equipment		480,000
Maintain pollution-control equipment		280,000
Clean up polluted lake		580,000
Restore land after use		780,000
Property damage claim		680,000

Required:

1. Prepare a cost-of-quality (COQ) report of environmental management for the year. Determine subtotals for each of the four reporting categories, and express each subtotal as a percentage of total operating expenses ($10,000,000) for the year. (Hint: Classify the pollution-control costs as internal failure costs, under the assumption that the process pollutes and that the pollution-control equipment used by the company controls the release of pollutants into the environment.)

Cost-of-Quality (COQ) Report Amounts Subtotals % of Total Operating Cost Prevention costs: % Appraisal costs: % Inte failure cos % External failure costs: % Totals %