Burns Corporation Manufactures Large Kitchen Appliances

Essay

Burns Corporation manufactures large kitchen appliances. The following represents financial information for two years:

Required:
(a) Classify these items into costs of prevention (P), appraisal (A), internal failure(I) or external failure
(E) activities.
(b) Calculate the ratio of prevention, appraisal, internal failure and external failure costs to sales for 2007 and 2008.
(c) Prepare a cost of quality report for 2007.