Forensic Specialists compiled the following information for its first quarter cost of quality report:
$$\begin{array} { l r r }
\text { Sales } & \$ 5,600,000 \
\text { Cost of goods sold } & \$ 3,360,000 \
\text { Disposing of scrap } & \$ 235,200 \
\text { Quality training } & \$ 84,000 \
\text { Inspecting materials on delivery } & \$ 280,000 \
\text { Performance reviews } & \$ 70,000 \
\text { Resolving customer complaints } & \$ 31,920 \
\text { Certifying suppliers } & \$ 140,000
\end{array}$$
-
The total cost of external failure activities at Forensic Specialists is:
A) $420,560.
B) $31,920.
C) $117,600.
D) $175,000.

Question

Forensic Specialists compiled the following information for its first quarter cost of quality report:
$$\begin{array} { l r r } 
\text { Sales } & \$ 5,600,000 \
\text { Cost of goods sold } & \$ 3,360,000 \
\text { Disposing of scrap } & \$  235,200 \
\text { Quality training } & \$  84,000 \
\text { Inspecting materials on delivery } & \$ 280,000 \
\text { Performance reviews } & \$  70,000 \
\text { Resolving customer complaints } & \$  31,920 \
\text { Certifying suppliers } & \$  140,000
\end{array}$$
-
The total cost of external failure activities at Forensic Specialists is:
A) $420,560.
B) $31,920.
C) $117,600.
D) $175,000.

Quizplus · Accepted Answer

External failure costs are costs incurred after the product has been delivered to the customer. Resolving customer complaints is the only external failure activity listed, costing $31,920.

Forensic Specialists Compiled the Following Information for Its First Quarter