ABC is a manufacturing company. It is currently reviewing its performance in respect of quality costs....
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ABC is a manufacturing company. It is currently reviewing its performance in respect of quality costs. Extracts from the company's records from each of the previous years are as follows: Warranty repairs Quality training Inspection of raw materials Reinspecting previously faulty products Finished goods inspections Scrap cost of internally detected faulty products Preventative machine maintenance Forgone contribution from loss of sales 2021 (£000) 1,700 4,600 3,600 4,200 5,700 2,900 6,400 900 2020 (£000) 3,500 3,300 2,800 8,500 4,200 6,000 5,000 1,300 Required: 1. Considering each of the two years, produce a cost of quality report using the four recognized headings. II. Discuss the outcome of the report and show how the improvement/deterioration in ABC's performance can affect the long- term reputation and financial outcomes of the company. ABC is a manufacturing company. It is currently reviewing its performance in respect of quality costs. Extracts from the company's records from each of the previous years are as follows: Warranty repairs Quality training Inspection of raw materials Reinspecting previously faulty products Finished goods inspections Scrap cost of internally detected faulty products Preventative machine maintenance Forgone contribution from loss of sales 2021 (£000) 1,700 4,600 3,600 4,200 5,700 2,900 6,400 900 2020 (£000) 3,500 3,300 2,800 8,500 4,200 6,000 5,000 1,300 Required: 1. Considering each of the two years, produce a cost of quality report using the four recognized headings. II. Discuss the outcome of the report and show how the improvement/deterioration in ABC's performance can affect the long- term reputation and financial outcomes of the company.
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Related Book For
Intermediate Accounting
ISBN: 9781259722660
9th Edition
Authors: J. David Spiceland, James Sepe, Mark Nelson, Wayne Thomas
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