Which of the following would be classified as a prevention cost on a quality cost report?
A) Cost of field servicing and handling complaints.
B) Quality engineering.
C) Lost sales arising from a reputation for poor quality.
D) Supervision of testing and inspection activities.

Question

Quizplus · Accepted Answer

Prevention costs are costs incurred to prevent defects from occurring in the first place. Quality engineering is a prevention cost, as it involves designing and planning for quality assurance to prevent defects from happening. Options A and D are examples of appraisal costs, which are incurred to detect and correct defects, while option C is an example of an external failure cost, which is incurred after a defect has occurred and resulted in lost sales.

Which of the Following Would Be Classified as a Prevention