The cost of fixing defective units found during the quality inspections would be classified as a(n)
A) prevention cost.
B) appraisal cost.
C) internal failure cost.
D) external failure cost.

Question

Quizplus · Accepted Answer

The cost of fixing defective units found during quality inspections is considered an internal failure cost. This is because the failure was caught before the product was shipped to the customer, but it still required resources to be spent to fix the issue. Prevention costs are associated with activities aimed at preventing defects from occurring in the first place, such as employee training or process improvement. Appraisal costs are associated with activities aimed at detecting defects, such as quality inspections. External failure costs are associated with defects that are not caught until the product has reached the customer, such as product recalls or warranty repairs.

The Cost of Fixing Defective Units Found During the Quality