Question 1

Why is it difficult to measure external failure costs? What are some nonfinancial measures quality management systems can use to gauge external failure?

Accepted Answer

The answer of Why is it difficult to measure external...

Question 2

List and briefly describe the four types of quality-related costs.

Accepted Answer

The answer of List and briefly describe the four types...

Question 3

Quality management systems use many nonfinancial measures, such as the number of customer complaints and the volume of incoming customer-service phone calls, as a means to measure success or failure.

Accepted Answer

Quality management systems commonly use nonfinancial measures such as customer complaints and customer service phone calls to gauge success or failure.

Question 4

Which of the following is true about quality management systems?
A) Quality management systems only use financial measures to assess success or failure.
B) External failure costs are the easiest quality costs to measure.
C) Businesses should invest upfront in prevention and appraisal costs.
D) Prevention, appraisal and internal costs are not considered in the cost of products.

Accepted Answer

Quality management systems require businesses to invest upfront in prevention and appraisal costs to avoid costly external failure costs in the long run. Quality management is not just about financial measures and considers all costs associated with product quality, including prevention, appraisal, and internal costs. External failure costs may be easy to measure, but prevention is ultimately less expensive than repeatedly fixing problems that could have been prevented.

Question 5

Since quality improvement programs are always needed, there is no reason to compare the costs of undertaking a quality improvement program to the costs of continuing without the quality improvement program.

Accepted Answer

While quality improvement programs may be necessary, it is important to consider the costs involved in implementing such programs versus the potential benefits. Without comparing these costs, it is difficult to make a fully informed decision about whether or not to undertake a quality improvement program.

Question 6

________ are costs incurred to avoid poor-quality goods or services.
A) Prevention costs
B) Appraisal costs
C) Internal failure costs
D) External failure costs

Accepted Answer

Prevention costs are incurred to prevent the occurrence of poor-quality goods or services. They include costs associated with training, quality planning, quality improvement programs, and the design and implementation of quality control systems.

Question 7

Which of the following is an example of appraisal costs?
A) employee training cost
B) product testing cost
C) warranty costs
D) equipment maintenance costs

Accepted Answer

Appraisal costs are costs associated with inspections, testing, and other activities aimed at detecting defects or non-conformities before products or services are delivered to customers. Product testing costs are an example of appraisal costs. Employee training costs (A) are considered prevention costs, warranty costs (C) are considered failure costs, and equipment maintenance costs (D) can be either preventative or corrective but are not considered appraisal costs.

Question 8

Management compares the costs of undertaking a quality improvement program to the costs of continuing without the quality improvement program.

Accepted Answer

Management often considers the costs and benefits of undertaking a quality improvement program versus continuing without one before making a decision.

Question 9

Match between columns
                        Premises: Disposal of defective products during production
Inspection of test equipment
Rework substandard products
Warranty repairs and replacements
Field testing and appraisal at customer site
Technical support provided to suppliers
Liability arising from defective products

Accepted Answer

The Answer of Appraisal costs and Prevention costs and External is...

Quiz 19: Cost Management Systems: Activity-Based Just-In-Time

Why is it difficult to measure external failure costs? What are some nonfinancial measures quality management systems can use to gauge external failure?

List and briefly describe the four types of quality-related costs.

Quality management systems use many nonfinancial measures, such as the number of customer complaints and the volume of incoming customer-service phone calls, as a means to measure success or failure.

Which of the following is true about quality management systems?

Since quality improvement programs are always needed, there is no reason to compare the costs of undertaking a quality improvement program to the costs of continuing without the quality improvement program.

________ are costs incurred to avoid poor-quality goods or services.

Which of the following is an example of appraisal costs?

Management compares the costs of undertaking a quality improvement program to the costs of continuing without the quality improvement program.

Distinguish the following costs: