The concept of cost of quality is not applicable in service-type businesses such as accounting firms.

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The concept of cost of quality is applicable in service-type businesses such as accounting firms. The cost of quality includes the cost of prevention, appraisal, internal failures, and external failures. In a service business, prevention costs may include training employees, developing workflows, and applying quality procedures. Appraisal costs may refer to conducting internal audits or customer satisfaction surveys. Internal failures may involve rework, rectifying mistakes or errors, or fixing customer dissatisfaction issues. Finally, external failures might include customer complaints, refunds, or lawsuits. Thus, the cost of quality is relevant for firms offering services, including accounting firms.

The Concept of Cost of Quality Is Not Applicable in Service-Type