pareto chart and cost of quality report manufacturing company

Project Description:

the president of cardio care exercise equipment co. has been concerned about the
growth in costs over the last several years. the president asked the controller to perform
an activity analysis to gain a better insight into these costs. the activity analysis revealed
the following:

activities activity cost
correcting invoice errors $ 7,200
disposing of incoming materials with poor quality 21,600
disposing of scrap 43,200
expediting late production 36,000
final inspection 28,800
inspecting incoming materials 7,200
inspecting work in process 32,400
preventive machine maintenance 21,600
producing product 140,400
responding to customer quality complaints 21,600
total $360,000
the production process is complicated by quality problems, requiring the production
manager to expedite production and dispose of scrap.
instructions
1. prepare a pareto chart of the company activities.
2. use the activity cost information to determine the percentages of total costs that are
prevention, appraisal, internal failure, external failure, and not costs of quality (producing product).
3. determine the percentages of total costs that are value- and non-value-added.
4. interpret the information.
Skills Required:
Project Stats:

Price Type: Negotiable

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