The Following Information Pertains to Bull Company for the Current

question 133

Multiple Choice

The following information pertains to Bull Company for the current year:
$\begin{array}{lr}\text { Sales } & \$ 1,000,000 \\\text { Internal failure costs } & 125,000 \\\text { External failure costs } & 50,000 \\\text { Appraisal costs } & 35,000 \\\text { Prevention costs } & 25,000 \\\text { Cost of goods sold } & 375,000\end{array}$
-Refer to the figure.If quality costs were reduced to 2.5 percent of sales,by how much would profits increase?

• A)$25,000
• B)$125,000
• C)$180,000
• D)$210,000

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Definitions:

Invention

The creation or innovation of new ideas, processes, goods, or services that did not previously exist, contributing to technological or scientific advancement.

Income

Money earned from work, investments, business, or any other sources, representing the financial gain derived by individuals or businesses.

Technological Advance

A phase of innovation where new technologies significantly improve processes, goods, or services.

Manufacturing Industries

Sectors of the economy that use machinery, tools, and labor to produce goods for use or sale.