a. Using the information in Exercise 27-17, identify the cost of quality classification for each activity.

b. Prepare of cost of quality report. Assume sales for the period were $3,000,000. Round percents to one decimal place.

c. Interpret the cost of quality report.

Exercise 27-17

Activities Activity Cost

Correct shipment errors ........................$ 144,000

Disposing of scrap ............................. 90,000

Emergency equipment maintenance .......... 99,000

Employee training ............................ 36,000

Final inspection ................................ 81,000

Inspecting incoming materials ................ 54,000

Preventive equipment maintenance ......... 27,000

Processing customer returns ................. 90,000

Scrap reporting ............................... 36,000

Supplier development ....................... 9,000

Warranty claims ............................ 234,000

Total .........................................$900,000