Also shown are the cost allocation rates for the activities.

$($Click on the icon to view the information.$)$

Read the requirements.

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Requirement $1.$ Calculate the predicted quality cost savings from the design engineering work.

Requirement $2.$ The company spent $$85,000$ on design engineering for the new toy robot. What is the net benefit of this "preventive" quality activity?

$$

Less:

Net benefit of design engineering

Requirement $3.$ What major difficulty would management have had in implementing this costs$-$of$-$quality approach?

Measuring the cost...

$-$of engineering is diffucult

$-$of inspection activities is difficult

$-$quality related activities is difficult

What alternative approach could it use to measure quality improvement?

$-$focus only on the finacial measures of quality

Monitor competitiors measures of quality and continuously try to improve

$-$Monitior nonfinacial measures of quality and attempt to improve them

Data table.

Requirement $3$ with answer choices:

Requirement $3.$ What major difficulty would management have had in implementing this$$ costs$-$of$-$quality approach?

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Part $4$

What alternative approach could it use to measure quality$$ improvement?

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