Which of the following statements is correct?
A) Costs of controlling quality include prevention and appraisal costs.
B) Costs of failing to control quality include internal and external failure costs.
C) A and B are both correct.
D) A and B are both incorrect.

Question

Quizplus · Accepted Answer

Option A is correct. Prevention costs are the costs incurred to avoid the production of defects, such as the cost of training, while appraisal costs are incurred to identify the defects, such as the cost of inspection.
Option B is correct. Internal failure costs are the costs incurred when defects are discovered before the delivery of the product or service, such as the cost of rework, while external failure costs are incurred when defects are discovered after the delivery of the product or service, such as the cost of product recall.

Which of the Following Statements Is Correct