Figure 14-4
At the beginning of the year, Marinov Corporation initiated a quality improvement program. The program was successful in reducing scrap and rework costs. To help assess the impact of the quality improvement program, the following data were collected for the current and preceding years:

-Refer to Figure 14-4. For the current year, prevention costs are what percentage of sales?

Question

Figure 14-4
At the beginning of the year, Marinov Corporation initiated a quality improvement program. The program was successful in reducing scrap and rework costs. To help assess the impact of the quality improvement program, the following data were collected for the current and preceding years:
 
-Refer to Figure 14-4. For the current year, prevention costs are what percentage of sales?

Quizplus · Accepted Answer

To calculate the percentage of prevention cost to sales, we need to divide prevention cost by sales and multiply by 100. 
For the current year, prevention cost is $45,000 and sales are $30,000,000. 
Percentage of prevention cost to sales = ($45,000/$30,000,000) x 100 = 0.15% 
Therefore, the answer is C.

Figure 14-4 at the Beginning of the Year, Marinov Corporation Initiated a Initiated