Already have an account? Get multiple benefits of using own account!
Login in your account..!
Remember me
Don't have an account? Create your account in less than a minutes,
Forgot password? how can I recover my password now!
Enter right registered email to receive password!
Safe Travel produces car seats for children from newborn to 2 years old. The company is worried because one of its competitors has recently come under public scrutiny because of product failure. Historically, Safe Travels only problem with its car seats was stitching in the straps. The problem can usually be detected and repaired during an internal inspection. The cost of the inspection is $6 per seat and the repair cost is $1.25 per seat. All 175,000 car seats were inspected last year and 5% were found to have problems with stitching in the straps during the internal inspection. Another 1% of the 175,000 car seats had problems with the stitching, but the internal inspection did not discover them. Defective units that were sold and shipped to customers needed to be shipped back to Sage Travel and repaired. Shipping costs are $9 per car seat and repair costs are $1.25 per car seat. However, the out of pocket costs (shipping and repair) are not the only costs of defects not discovered in the internal inspection. Negative publicity will result in a loss of contribution margin of $168 for each external failure.
Required:
Calculate the appraisal cost, internal failure cost and out of pocket external failure cost.
Determine the opportunity cost associated with the external failures.
What are the Total Costs of Quality in dollars?
Safe Travel is concerned with the high upfront cost of inspecting all 175,000 units. It is considering an alternative inspection plan that will cost only $3.50 per car seat inspected. During the internal inspection, this alternative technique will detect only 2.5% of the 175,000 car seats that have stitching problems. The other 3.5% will be detected after the car seats are sold and shipped. What are the total costs of quality for the alternative technique?
Monterey Corporation is considering the purchase of a machine costing $52,000 with a 4-year useful life and no salvage value. Monterey uses straight-line depreciation and assumes that the annual cash inflow from the machine will be received unifor..
If fixed costs are $300,000, the unit selling price is $31, and the unit variable costs are $22, what is the break-even sales (units) if fixed costs are reduced by $30,000?
How much income must Dave report for the tax year and what is the character of the income? What is Dave's basis in his partnership interest at the end of the tax year?
Prepare the journal entry to recognize the income tax benefit of the operating loss in 2011. Fores elects the carryback option.
Discuss the reasons a consulting firm might use a normal costing system rather than an actual costing system. What might be some reasons for the firm to change from a one-pool to a multiple-pool allocation concept?
1. why is the us health care system considered complex?2. how do health care organizations get paid? do
Which statement is true regarding accounting and time frames?
Describe the factors that determine whether expenditures toward property, plant, and equipment already in use should be capitalized.
Federal corporate income tax rates never exceeded an average rate of - Which of the following would result in a decrease in cash flow and a use of cash
Chev Corporation, a calendar year corporation, has alternative minimum taxable income (before any exemption) of $1.28 million for 2008. The company is not a small corporation. If the regular corporate tax is $209,000, Chev's alternative minimum ta..
An error was made in the computation of the percentage-of-completion of the current year's ending work-in-process inventory. The error resulted in assigning a higher percentage-of-completion to each component of the inventory than actually was the..
Calistoga Produce estimates bad debt expense at ½% of credit sales. The company reported accounts receivable and allowance for uncollectible accounts of $471,000 and $1,650 respectively, at December 31, 2010.
Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!
whatsapp: +1-415-670-9521
Phone: +1-415-670-9521
Email: [email protected]
All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd