COQ Histogram Genova Company classifies its costs of quality into four categories. The costs of quality (COQ) as a percentage of cost of goods sold for the last three years are as follows:
|
|
2010
|
2011
|
2012
|
|
Prevention costs
|
1.00%
|
4.00%
|
2.00%
|
|
Appraisal costs
|
3.00
|
2.50
|
1.50
|
|
Internal failure costs
|
27.00
|
23.00
|
14.00
|
|
External failure costs
|
31.00
|
18.00
|
12.00
|
Required
1. Use a spreadsheet to prepare a histogram that shows the costs of quality (COQ) trends as a percentage of costs of goods sold.
2. Comment on the trends in cost of quality (COQ) over the three-year period from 2010 to 2012.
3. What cost of quality can the company expect as a percentage of its cost of goods sold in 2013? Explain.