Costs incurred in conjunction with the measurement and analysis of data to ascertain conformity of products and services to specification are properly classified as:
A)External failure costs.
B)Appraisal costs.
C)Internal failure costs.
D)Prevention costs.
E)Value-added costs.

Question

Quizplus · Accepted Answer

The costs incurred in measuring and analyzing data to ensure that the products and services conform to the specification are classified as appraisal costs. Appraisal costs are the costs of activities such as inspection, testing, and other activities aimed at ensuring that products or services conform to specifications. These costs are incurred to identify defects and errors early in the process to minimize the costs of internal and external failures.

Costs Incurred in Conjunction with the Measurement and Analysis of Data