The annual report issued by Leonard Software Inc. includes several expenditure items, listed in the table below. assignment

The annual report issued by Leonard Software Inc. includes several expenditure items, listed in the table below. The annual report issued by Leonard Software Inc. includes several expenditure items, listed in the table below. The annual report issued by Leonard Software Inc. includes several expenditure items, listed in the table below. Indicate the subclass of cost of software quality to which each of the following expenditures belongs: PC =prevention costs, AC =appraisal costs, IFC =internal failure costs, EFC = external failure costs, MPC = management prevention costs, MAC= management appraisal costs, IMFC= internal management failure costs, and EMFC =external management failure costs. In cases where an expenditure item is not a software quality cost, mark “X” in the “nonsoftware quality cost” column. _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ _________ Leonard Software Inc.: expenditure Subclass Nonsoftware of software quality cost No. Expenditure item quality cost 1 Working hours spent installing software at customer’s site in Singapore 2 Waiving of customer’s debt as agreed to in compromise following software failures detected in the installed software 3 Payment for Dr. Jacobs’s participation in a design review 4 Payments made to “King SQA Consultants” for preparing the new version of the software quality procedures 5 Repair of a color printer 6 Working hours spent participating in monthly meetings of the Coordination and Control Committee headed by the Department Manager 7 Travel to Switzerland to examine advanced software testing system proposed to company 8 Purchase of barcode sticker software package to be integrated in the inventory management software system. 9 Working hours spent correcting errors listed in a design review report. 10 Customer’s compensation for delay in schedule resulting from the company’s inability to recruit sufficient professional manpower for the development team. 11 Working hours spent by the Chief Software Engineer and Martin Fountain, Senior Project Manager, in examining the schedule estimates for the “Top Assets” tender. 12 Working hours spent in preparation of an updated version of Leonard Software’s C Programming Instructions. 13 Working hours spent by programmer (John) in correcting program bugs detected by his team leader in their weekly meeting. 186 Chapter 9 Cost of Software Quality 9.5 The company’s last year’s annual CoSQ were as follows: Cost of software Previous year’s annual quality class costs in thousands $ Development and SQA Prevention costs $1,238 activities quality costs Appraisal costs $3,450 Internal failure costs $4,238 External failure costs $2,890 Management quality costs Management $225 prevention costs Management $127 appraisal costs Internal management $1,840 failure costs External $4,650 Management failure costs Development costs $12,876 (design and coding) The software quality assurance manager has proposed a dramatic change in Leonard Software’s software quality expenditures policy. It is expected to reduce failure costs by the following significant percentages: internal failure costs – 10%, external failure costs – 25%, and managerial internal and external failure costs – at least 25%. The SQA manager’s proposal involves increasing expenditures as follows: prevention costs $400,000, appraisal costs $700,000, managerial prevention costs $580,000, and management appraisal costs $220,000. Management commented about the proposed extravagant expenditures required for the proposed SQA progress project. Management requested that you evaluate the SQA manager’s proposal. a. Examine the proposal and calculate its results from a financial aspect. b. Explain in your own words, how this dramatic program’s additional funds should be utilized in order to bring about the expected reduction in failure costs. c. Can you list any hidden costs of failure that have not been mentioned in the program, but which are expected to be reduced as a result of implementing the proposal? d. Assuming the scope of development activities for next year will be similar to that of last year, will the proposed project reduce the percentage of CoSQ in the total costs of software products? Present your calculations.
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