Which of the following would be classified as an external failure cost on a quality cost report?
A) Depreciation of test equipment.
B) Test and inspection of in-process goods.
C) Test and inspection of incoming materials.
D) Warranty repairs and replacements.

Question

Quizplus · Accepted Answer

Warranty repairs and replacements are costs incurred after the product has been delivered to the customer and are considered an external failure cost. Depreciation of test equipment is a cost that would be considered a prevention cost. Test and inspection of in-process goods and incoming materials are costs that would be considered appraisal costs.

Which of the Following Would Be Classified as an External