What type of cost are labour and overhead incurred for rework of defective products found by an inspector?
A)external failure cost
B)internal failure cost
C)appraisal cost
D)prevention cost

Question

Quizplus · Accepted Answer

Labour and overhead incurred for rework of defective products found by an inspector are classified as internal failure costs. These costs are incurred when defects are detected before the product is delivered to the customer. Rework costs, such as the cost of additional labour, materials, and overhead, are incurred to correct the defects and bring the product up to the required standard.

What Type of Cost Are Labour and Overhead Incurred for Rework