Problems:
1. Classify the following quality costs:
-
Costs Amount Product Recall Cost
Rework Rejected Outgoing Lot
Freight for Rejected Goods from Customer
TQM Training Class for Operators
Quality Engineer’s salary
In-process Inspection
Down-time Due to Rejected Parts
Quality Audit of Supplier$10,500
2,500
450
3,000
12,000
5,600
4,500
1,500
Report the total quality costs by category.
2. If sales for the period are $1,400,000, Calculate the quality costs in Problem 1 as a percentage of sales. What conclusions can be drawn? What are the advantages and disadvantages of reporting quality costs as a percentage of sales?
3. If total costs of production are 1,000,000, calculate the quality costs in Problem 1 as a percentage of total costs. What conclusions can be drawn? What are the advantages and disadvantages of reporting quality costs as a percentage of total costs?
Above questions are from “Essentials of Quality” Chapter 12 Quality Costs written by Victor E. Sower, ISBN 9780470509593
0 comments