Which of the Following Would Be Classified as an Internal

question 40

Multiple Choice

Which of the following would be classified as an internal failure cost on a quality cost report?

• A) Rework labor and overhead.
• B) Cost of field servicing and handling complaints.
• C) Technical support provided to suppliers.
• D) Lost sales arising from a reputation for poor quality.

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Definitions:

Sales Considered

Refers to the total revenue or the amount of sales transactions recognized by a company within a certain period.

Uncollectible Accounts

Receivables that are deemed uncollectible and are written off as a loss due to the inability to collect the funds.

Allowance Account

An account used to offset the gross accounts receivable by the amount estimated to be uncollectible.

Accounts Receivable

Unsettled payments from customers to a business for goods delivered or services carried out.