2. A B C D E F G H 1 Classifying quality costs and using these costs to make decisions 2 Clarke, Inc. manufactures door panels. Suppose Clarke is considering spending the following 3 Jamounts on a new total quality management (TQM) program: 4 Strength-testing one item from each batch of panels 5 $ 62,000 6 Training employees in TQM 25,000 7 Training suppliers in TQM 38,000 8 Identifying suppliers who commit to on-time delivery of perfect-quality materials 56,000 9 10 Clarke expects the new program would save costs through the following: 11 12 Avoid lost profits from lost sales due to disappointed customers $ 94,000 13 Avoid rework and spoilage 60,000 14 Avoid inspection of raw materials 55,000 15 Avoid warranty costs 20,000 16 17 Requirements 1. Classify each cost as a prevention cost, an appraisal cost, an internal ilure cost, or an 18 external failure cost. 192. Should Clarke implement the new quality program? Give your reason. 20 21 22 23 24 25 Instructions 2 3 1 2 3