The following information pertains to Rudy Company for 2014:
$\begin{array}{lr}
\text { Sales } & \$ 10,000,000 \
\text { Internal failure costs } & 300,000 \
\text { External failure costs } & 200,000 \
\text { Appraisal costs } & 125,000 \
\text { Prevention costs } & 50,000 \
\text { Cost of goods sold } & 5,000,000
\end{array}$
Calculate by how much profits would increase if quality costs were reduced to 2.5 percent of sales.

Question

The following information pertains to Rudy Company for 2014:
 $\begin{array}{lr}
\text { Sales } & \$ 10,000,000 \
\text { Internal failure costs } & 300,000 \
\text { External failure costs } & 200,000 \
\text { Appraisal costs } & 125,000 \
\text { Prevention costs } & 50,000 \
\text { Cost of goods sold } & 5,000,000
\end{array}$
 Calculate by how much profits would increase if quality costs were reduced to 2.5 percent of sales.

Quizplus · Accepted Answer

The Answer of The following information pertains to Rudy Company for 2014:
 $\begin{array}{lr}
\text { Sales } & \$ 10,000,000 \
\text { Internal failure costs } & 300,000 \
\text { External failure costs } & 200,000 \
\text { Appraisal costs } & 125,000 \
\text { Prevention costs } & 50,000 \
\text { Cost of goods sold } & 5,000,000
\end{array}$
 Calculate by how much profits would increase if quality costs were reduced to 2.5 percent of sales.

The Following Information Pertains to Rudy Company for 2014 Calculate by How Much Profits Would Increase If Quality Costs