Which of the following would be classified as an internal failure cost on a quality cost report?
A) Rework labor and overhead.
B) Cost of field servicing and handling complaints.
C) Technical support provided to suppliers.
D) Lost sales arising from a reputation for poor quality.

Question

Quizplus · Accepted Answer

Rework labor and overhead is a cost incurred due to the failure to meet quality standards within the organization, making it an internal failure cost. The other options listed are external failure costs (B and D) and prevention costs (C).

Which of the Following Would Be Classified as an Internal