Which of the following would be classified as an external failure cost on a quality cost report?
A) Product recalls.
B) Quality engineering.
C) Quality training.
D) Systems development.

Question

Quizplus · Accepted Answer

Product recalls are an example of external failure costs because they occur after the product has already been delivered to the customer and they can result in lost revenue, legal fees, and damage to the company's reputation. Quality engineering, quality training, and systems development are all examples of prevention and appraisal costs that are designed to prevent defects from occurring in the first place.

Which of the Following Would Be Classified as an External