In a Cost of Quality (COQ) Report, Sales Returns and Allowances

question 9

Multiple Choice

In a Cost of Quality (COQ) report, sales returns and allowances due to quality deficiency would be classified as:

• A) Prevention costs.
• B) Salvage costs.
• C) Appraisal costs.
• D) Internal failure costs.
• E) External failure costs.

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Definitions:

Pounds

A unit of mass or weight commonly used in the British imperial and United States customary systems.

Materials Price Variance

The difference between the actual cost and the standard cost of materials used in production, multiplied by the quantity of materials used.

Standard Price

A pre-determined cost assigned to goods and services, used as a benchmark in budgeting and variance analysis.

Pounds

A unit of weight commonly used in the British imperial and United States customary measurement systems.