Cokesbury Corporation is a manufacturer of electronic blood pressure monitors for
home use. The following is a summary of quality costs for the first year of operations.
Total defective units 1,500
Number of units reworked 800
Number of customer units returned 200
Profit for a good unit $50
Profit for a defective unit $30
Cost to rework a defective unit $12
Cost of a returned unit $20
Total prevention cost $17,500
Total appraisal cost $9,500
1. Refer to Cokesbury Corporation. Compute the profit lost by selling defective units not reworked.
2. Refer to Cokesbury Corporation. Compute the total rework cost.
3. Refer to Cokesbury Corporation. Compute the cost of processing customer returns.
4. Refer to Cokesbury Corporation. What is the total failure cost?
5. Refer to Cokesbury Corporation. Determine the total quality cost.
