the answer:
To prepare a cost of quality report based on the given information, we need to categorize the quality costs into four main categories: prevention costs, appraisal costs, internal failure costs, and external failure costs.
Given quality costs:
- Training machine operators: $50,000 (Prevention cost)
- Product recalls: $20,000 (External failure cost)
- Scrap of defective products: $12,000 (Internal failure cost)
- Inspecting finished goods: $18,000 (Appraisal cost)
Now, let's calculate the total cost for each category:
1. Prevention costs:
- Training machine operators: $50,000
Total prevention costs: $50,000
2. Appraisal costs:
- Inspecting finished goods: $18,000
Total appraisal costs: $18,000
3. Internal failure costs:
- Scrap of defective products: $12,000
Total internal failure costs: $12,000
4. External failure costs:
- Product recalls: $20,000
Total external failure costs: $20,000
Now, let's calculate the total cost of quality by adding up the costs in each category:
Total cost of quality = Prevention costs + Appraisal costs + Internal failure costs + External failure costs
Total cost of quality = $50,000 + $18,000 + $12,000 + $20,000 = $100,000
Therefore, the cost of quality report is as follows:
- Prevention costs: $50,000
- Appraisal costs: $18,000
- Internal failure costs: $12,000
- External failure costs: $20,000
Total cost of quality: $100,000
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