Explaining cost breakdowns to your client


Question: You are responsible for explaining cost breakdowns to your client. The project described will implement a new high-speed beverage can filling and canning system for PepsiCo.: Incoming materials inspection, annual cost: 5,000; Training for suppliers, quality program (ISO-9000) annual cost 20,000; Software for supplier quality program annual cost 50,000; Materials buyers training for new quality software annual cost 10,000; Mfg line-worker quality training annual cost 10,000; Product scrap annual cost 3,000; Packaging inspection annual cost 5,000; Packaging scrap annual cost 5,000; Line stops due to poor product conformance annual cost 5,000; Equipment for conformance testing lab annual cost 50,000; Product conformance testing lab quality training annual cost 5,000; Product loss due to destructive product testing annual cost 2,000; Totals 170,000; what are the prevention costs?

 

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