Grady Industries manufactures freezers. Here is some information about its LX17 line of freezers over the...

 

Transcribed Image Text:

Grady Industries manufactures freezers. Here is some information about its "LX17" line of freezers over the past year: E (Click the icon to view the information.) Read the requirements. Requirement 1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs of each category, calculate the percentage of COQ category of the total COQ. (Round the percentage to the one tenth of a percent, X.X%. If a box is not used in the table leave the box empty; do not select a label or enter a zero.) Grady Cost of Quality Report Costs Total Costs of Percentage of Total Costs Incurred Quality of Quality (Rounded) Prevention Costs: Design engineering 84000 Total prevention costs 84000 Appraisal Costs: Testing and inspection Total appraisal costs % Internal Failure Costs: Rework (internal) Internal Failure Costs: Rework (internal) Total internal failure costs External Failure Costs: Lost profits due to poor reputation Total external failure costs % Total costs of quality % 1 Requirements 1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs of each category, calculate the percentage of COQ category of the total COQ. 2. Why would the variable repair cost at the customers' home generally be higher than the "in factory" rework cost? 3. How can use of the COQ report lead to improvements in the production process or in the quality of the product itself? Print Done Number of units manufactured and sold 2,500 units Selling price per unit . 1,600 Variable manufacturing and selling costs per unit 700 Hours spent by engineers improving design.. 1,200 Testing and inspection hours per unit ... 0.5 hours Percentage of units reworked in the plant after inspection 7% Average variable rework costs per refrigerator.. 480 Percentage of units repaired under warranty at customers' homes 4% Average variable repair costs at customers' homes per refrigerator.. 550 Estimated.lost sales.due to quality. reputation..... Design engineer's labor rate (includes benefits and payroll taxes). Inspection costs per hour.... 450 units $70 per hour $20 per hour Grady Industries manufactures freezers. Here is some information about its "LX17" line of freezers over the past year: E (Click the icon to view the information.) Read the requirements. Requirement 1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs of each category, calculate the percentage of COQ category of the total COQ. (Round the percentage to the one tenth of a percent, X.X%. If a box is not used in the table leave the box empty; do not select a label or enter a zero.) Grady Cost of Quality Report Costs Total Costs of Percentage of Total Costs Incurred Quality of Quality (Rounded) Prevention Costs: Design engineering 84000 Total prevention costs 84000 Appraisal Costs: Testing and inspection Total appraisal costs % Internal Failure Costs: Rework (internal) Internal Failure Costs: Rework (internal) Total internal failure costs External Failure Costs: Lost profits due to poor reputation Total external failure costs % Total costs of quality % 1 Requirements 1. Prepare a Cost of Quality (COQ) report. In addition to calculating the total costs of each category, calculate the percentage of COQ category of the total COQ. 2. Why would the variable repair cost at the customers' home generally be higher than the "in factory" rework cost? 3. How can use of the COQ report lead to improvements in the production process or in the quality of the product itself? Print Done Number of units manufactured and sold 2,500 units Selling price per unit . 1,600 Variable manufacturing and selling costs per unit 700 Hours spent by engineers improving design.. 1,200 Testing and inspection hours per unit ... 0.5 hours Percentage of units reworked in the plant after inspection 7% Average variable rework costs per refrigerator.. 480 Percentage of units repaired under warranty at customers' homes 4% Average variable repair costs at customers' homes per refrigerator.. 550 Estimated.lost sales.due to quality. reputation..... Design engineer's labor rate (includes benefits and payroll taxes). Inspection costs per hour.... 450 units $70 per hour $20 per hour