Activity-Based Quality Costing

Abernathy, Inc., produces two different generators and is concerned about their quality. The company has identified the following quality activities and costs associated with the two products:

	Generator A	Generator B
Units produced	162,400	346,800
Warranty work (units)	1,720	810
Scrapped units (number)	3,390	870
Inspection (hours)	3,380	1,750
Quality training (hours)	86	86
Activities:
Performing warranty work	$812,130
Scrapping units	634,740
Inspecting	292,410
Quality training	86,344

Required:

1. Calculate the quality cost per unit for each product, and break this unit cost into quality cost categories. If required, round your answers to the nearest cent.

	Generator A	Generator B
Unit cost	$	$

Which of the two seems to have the lowest quality?

- Select your answer -Generator A,Generator B, or Not enough information is given to answer