The following quality cost report came from the records of Vargas Company. Required a. Explain the strategy

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The following quality cost report came from the records of Vargas Company.

Required
a. Explain the strategy that Vargas Company initiated to control its quality costs.
b. Indicate whether the strategy was successful or unsuccessful in reducing quality costs.
c. Explain how the strategy likely affected customersatisfaction.

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Fundamental Managerial Accounting Concepts

ISBN: 978-0078025655

7th edition

Authors: Thomas Edmonds, Christopher Edmonds, Bor Yi Tsay, Philip Old

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Question Posted: Feb 07, 2014 10:30 AM

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The following quality cost report came from the records of Vargas Company. Required a. Explain the strategy

Question:

2014 2013 Amount Percentage Amount Percentage Depreciation on prevention equipment58,000 Incentives and awards Testing equipment (depreciation) Total internal failure External failure cost Warranty repairs and replacement Customer relations Restocking and packaging 4 Total extermal failure

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a The data in the quality cost report suggest that Vargas initiated an aggre...View the full answer

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