Internal Failure Costs Are Costs That

question 132

Multiple Choice

Internal failure costs are costs that:

• A)are incurred to prevent quality problems from occurring in the first place.
• B)are incurred to identify defective products before products are shipped to the customer.
• C)result from defects that are caught before the product is shipped to the customer.
• D)occur when a defective product makes its way into the hands of the customer.

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Definitions:

Corporation

A legal entity recognized by law, distinct from its owners, with rights to own property, sue or be sued.

Accounting System

A structured process used to collect, record, classify, summarize, and interpret financial information for decision making.

Classifies

To arrange or categorize entities based on shared characteristics or criteria.

Transactions

The exchange or transfer of goods, services, or funds between two or more parties, recorded in the financial records of the entities involved.