The following information pertains to Bull Company for the current year:
$\begin{array}{lr}
\text { Sales } & \$ 1,000,000 \
\text { Internal failure costs } & 125,000 \
\text { External failure costs } & 50,000 \
\text { Appraisal costs } & 35,000 \
\text { Prevention costs } & 25,000 \
\text { Cost of goods sold } & 375,000
\end{array}$
-Refer to the figure.What percentage of sales are quality costs?

Question

Quizplus · Accepted Answer

Quality costs include internal failure costs, external failure costs, appraisal costs, and prevention costs. Adding these together: $125,000 + $50,000 + $35,000 + $25,000 = $235,000. To find the percentage of sales, divide the total quality costs by sales: $235,000 / $1,000,000 = 23.5%.

The Following Information Pertains to Bull Company for the Current