Erin Stover has been appointed chief accountant for Dancer Industries. The compa

Question

Erin Stover has been appointed chief accountant for Dancer Industries. The company has three divisions that manufacture floor tiles. The industry is very competitive, and Dancer Industries has lost market share in each of the last four years. Three years ago, management announced a companywide restructuring and the adoption of total quality management. Since that time, each of the divisions has been allowed to chart its own path toward TQM. Stover is new to the company and has asked to see summary figures of the costs of quality for each of the divisions. The following data were presented to her for the past six months:

a. Total quality costs as a percentage of sales for Adams County are?

b. nonconformance costs as percentage of sales for Butler County are?

Erin Stover has been appointed chief accountant for Dancer Industries. The company has three divisions that manufacture floor tiles. The industry is very competitive, and Dancer Industries has lost market share in each of the last four years. Three years ago, management announced a companywide restructuring and the adoption of total quality management. Since that time, each of the divisions has been allowed to chart its own path toward TQM. Stover is new to the company and has asked to see summary figures of the costs of quality for each of the divisions. The following data were presented to her for the past six months:

Explanation / Answer

171,430/2,650,000= .064691= 6.47%

(31,450+28,450)/2,150,000= 0.02786= 2.79%

I assume non conformance costs are the sum of the failure costs.

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