HNW Ltd
HNW Ltd -What Are HNW's Total External Failure Costs?
A) $130 000

Multiple Choice

HNW Ltd.
HNW Ltd. manufactures and sells food processors. A popular consumer magazine has recently evaluated food processors and has ranked HNW’s processors as being of ‘poor quality’. As a result, HNW’s management team has begun to analyse all costs associated with their food processors in more detail, and the following data has been compiled:
$\begin{array}{lr}\text { Scrap costs } & \$ 80000 \\\text { Quality training } & 75000 \\\text { Warranty claims } & 100000 \\\text { Rework costs } & 50000 \\\text { Inspection of incoming materials } & 30000 \\\text { Product quality audits } & 60000 \\\text { Statistical nrocess control } & 40000\end{array}$
-What are HNW's total external failure costs?

A) $130 000
B) $160 000
C) $180 000
D) $100 000