Maurice Tutor

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Category > Management Posted 21 Mar 2018 My Price 7.00

Huskie Company

Problem A Here are cost items from Huskie Company's accounts for a typical month:

Inspection at the end of the production process

$80,000

Cost of returned goods

36,000

Design work to improve the way products are

48,000

made

  

Repairs to satisfy customer complaints

20,000

Employee training

24,000

Incoming materials inspection

20,000

Scrap

36,000

  1. Classify these items into prevention costs, appraisal costs, internal failure costs, and external failure costs.

  2. Suppose Huskie Company could spend an additional USD 40,000 per month on design work to improve the way products are made, and thereby reduce internal failure and external failure costs by 30 per cent each per month. (Appraisal costs would not be affected.) Would this be a wise thing for Huskie Company to do?

  3. Give two examples of additional nonfinancial quality measures that Huskie Company could use to help improve quality. (Hint: See Exhibit 16.)

Answers

Maurice Tutor
(5)
Status NEW Posted 21 Mar 2018 06:03 AM My Price 7.00

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