Adolphson Corporation Has Provided the Following Summary of Its Quality

question 46

Multiple Choice

Adolphson Corporation has provided the following summary of its quality cost report for the last two years:
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On the basis of this report,which one of the following statements is most likely correct?

• A) An increase in prevention and appraisal costs resulted in fewer defects, and therefore, resulted in a decrease in internal and external failure costs.
• B) A decrease in internal and external failure costs resulted in less need for prevention and appraisal costs.
• C) Quality costs such as scrap and rework decreased by 48%.
• D) Quality costs such as returns and repairs under warranty decreased by 40%.

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Definitions:

Trade Discount

A reduction from the list price of goods or services provided by a vendor to buyers in the trade.

Trade Discount

A reduction in the retail or list price of a product or service provided by a seller to a buyer in the trade channel.

Trade Discount

A reduction in price offered by a seller to a buyer for purposes of increasing sales, typically calculated as a percentage off the list price.

Trade Discount

A deduction from the list price of goods agreed upon by the seller and the buyer, typically offered by suppliers to retailers.