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Scrap is an example of ? Regal Products has a budget of $900,000 in 20X3 for prevention costs

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1 Scrap is an example of;external failure costs.;Internal failure costs.;Prevention costs.;Appraisal costs.;2 Regal Products has a budget of $900,000 in 20X3 for prevention costs. If it decides to automate a portion of its prevention activities, it will save $60,000 in variable costs. The new method will require $18,000 in training costs and $120,000 in annual equipment costs. Management is willing to adjust the budget for an amount up to the cost of the new equipment. The budgeted production level is 150,000 units. Appraisal costs for the year are budgeted at $600,000. The new prevention procedures will save appraisal costs of $30,000. Internal failure costs average $15 per failed unit of finished goods. The internal failure rate is expected to be 3% of all completed items. The proposed changes will cut the internal failure rate by one-third. Internal failure units are destroyed. External failure costs average $54 per failed unit. The

 

Paper#20938 | Written in 18-Jul-2015

Price : $27
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