Gaffney Company’s quality cost report is to be based on the following data:
|
Final product testing and inspection |
$60,000 |
|
Rework labor and overhead |
$60,000 |
|
Statistical process control activities |
$78,000 |
|
Quality data gathering, analysis, and reporting |
$24,000 |
|
Returns arising from quality problems |
$77,000 |
|
Liability arising from defective products |
$89,000 |
|
Depreciation of test equipment |
$62,000 |
|
Downtime caused by quality problems |
$80,000 |
|
Supervision of testing and inspection activities |
$11,000 |
Required:
Prepare a Quality Cost Report in good form with separate sections for prevention costs, appraisal costs, internal failure costs, and external failure costs.