Altronics Inc. makes 2 models of laptop computers. The standard model is designed for the home user while the gamer targets advanced users. Both models are sold online and the company has a 30-day, money-back satisfaction guarantee. Information on each model for the last 12 months is as follows: Standard Gamer Units assembled and sold 20,000 10,000 Sales price per unit $ 870 $2,377 Seminars with suppliers on quality requirements 10 40 Sample testing hours of incoming components 200 2,040 Testing and final inspection hours per unit 0.5 1.0 Percentage of units reworked in plant 6% 12% Rework costs per unit repaired at customer site $ 550 $ 800 Percentage of units repaired at customer site 4% 7% Repair costs per unit repaired under warranty $ 600 $ 920 Percentage of units under warranty returned for repair 3% 2% Repair cost per unit $ 200 $ 230 Customer returns within 30 days of the date of purchase 1% 1.5% Cost of activities Seminars $15,000/seminar Testing and inspection $58/hour 

REQUIRED: 1. Prepare the cost of quality report for Altronics Inc. (14 marks) 2. Discuss the costs of quality. (4 marks) 3. Give two examples of non-financial quality measures that Altronics could monitor as part of its quality-control program. (2 marks)

Answer rating: 100% (QA)

Cost of Quality Report for Altronics Inc Cost Category Standard Model Gamer Model Total Prevention Costs Seminars with suppliers 150000 600000 750000 ... View the full answer