You are given the following environmental quality-related costs: Employee training $ 150,000 Product design 190,000 Supplier certification
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Question:
You are given the following environmental quality-related costs:
Employee training | $ | 150,000 | |
Product design | 190,000 | ||
Supplier certification | 65,000 | ||
Process inspection | 345,000 | ||
Depreciation—pollution-control equipment | 450,000 | ||
Maintain pollution-control equipment | 250,000 | ||
Clean up polluted lake | 550,000 | ||
Restore land after use | 750,000 | ||
Property damage claim | 650,000 | ||
Required:
1. Prepare a cost-of-quality (COQ) report of environmental management for the year. Determine subtotals for each of the four reporting categories, and express each subtotal as a percentage of total operating expenses ($10,000,000) for the year. (Hint: Classify the pollution-control costs as internal failure costs, under the assumption that the process pollutes and that the pollution-control equipment used by the company controls the release of pollutants into the environment.) (Round your percentage answers to 1 decimal place.)
Related Book For
Cost management a strategic approach
ISBN: 978-0073526942
5th edition
Authors: Edward J. Blocher, David E. Stout, Gary Cokins
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