Flip Flop’s To Go has gathered the following data on its quality costs for the past two years:
| Year 1 | Year 2 |
Prevention costs: | ||
Quality training | $ 8,000 | $10,500 |
Quality technology | 7,500 | 9,000 |
Quality production design | 4,000 | 9,000 |
Failure costs: | ||
Warranty handling | $15,000 | $10,000 |
Customer reimbursements | 11,000 | 7,200 |
Customer returns handling | 7,000 | 4,000 |
a. Compute the percentage change in the total quality costs from year 1 to year 2.
b. Explain what you think caused the change.
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