Walton Company has measured its quality costs for the past two years. After the company...
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Accounting
Walton Company has measured its quality costs for the past two years. After the company gathers its quality cost data, it summarizes those costs using the four categories shown below:
Last Year
This Year
Prevention costs
$ 385,600
$ 617,500
Appraisal costs
$ 409,400
$ 545,000
Internal failure costs
$ 758,400
$ 455,000
External failure costs
$ 1,100,000
$ 612,000
Required:
1. Calculate the total cost of quality last year and this year.
2. For last year, calculate the cost in each of the four categories as a percent of the total cost of quality.
3. For this year, calculate the cost in each of the four categories as a percent of the total cost of quality.
4-a. Calculate the change in total cost of quality over the two-year period.
4-b. Is performance trending in a favorable or unfavorable direction?
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