The administrator of elections for the city of Sweetwater has been asked to perform an activity analysis of its optical scanning center. The optical scanning center reads voter forms into the computer. The result of the activity analysis is summarized as follows:
Activities Activity Cost
Correcting errors identified by election commission ………..$ 96,000
Correcting jams ………………………………………………..84,000
Correcting scan errors …………………………………………48,000
Loading ………………………………………………………..24,000
Logging in control codes (for later reconciliation) ……………18,000
Program scanner ……………………………………………….24,000
Rerunning job due to scan reading errors ……………………..22,000
Scanning ……………………………………………………….52,000
Verifying scan accuracy via reconciling totals …………………20,000
Verifying scanner accuracy with test run ………………………12,000
Total …………………………………………………………$400,000
Instructions
1. Prepare a Pareto chart of the department activities.
2. Use the activity cost information to determine the percentages of total department costs that are prevention, appraisal, internal failure, external failure, and not costs of quality. Round percentages to one decimal place.
3. Determine the percentages of the total department costs that are value and non value added. Round percentages to one decimal place.
4. Interpret the information.
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