The following data have just been gathered on last year's quality-related costs at the Ideal Company:

Total sales last year were $75,000,000.Required(a) Prepare a cost-of-quality report grouping costs into prevention, appraisal, internal failure, and external failure. Also show costs as a percentage of sales.(b) Interpret the data and make recommendations to Ideal's management.

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CosT CATEGORY AMOUNT Product recalls $325,000 Downtime due to defects 600,000 420,000 Warranty claims 300,000 Inspection of and testing of incoming materials Product liability lawsuits 500,000 Process quality audits 350,000 Rework costs 2,000,000 150,000 Quality training Process control monitoring 350,000 Repair costs in the field Statistical process control 375,000 300,000 Waste 900,000 Net cost of scrap Supplier certification 1,500,000 350,000 200,000 Quality engineering Returned products 380,000