You have been hired as a Cost Accountant by Sundial,

You have been hired as a Cost Accountant by Sundial, Inc., which produces sunglasses. Your duties include developing cost standards for materials and labor, designing and implementing cost accounting systems, defining various product and operational costs, analyzing production costs and recommending changes. When the trial period is over, you will have a performance review to demonstrate the completed tasks and gained knowledge.You have read the Cost of Quality Report of Sundial, Inc. and discovered that quality costs constitute 4.2% of sales. The amount is enormous, and your boss asks you to develop a set of measures to reduce it.Sundial, Inc.Cost of Quality ReportFor the YearCost of QualityPercent of Sales ($32,000,000)Prevention costs$160,0000.5%Appraisal costs$192,0000.6%Internal failure costs$576,0002.8%External failure costs$416,0001.3%Total cost of quality$1,344,0004.2%

 

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