- What Will Be the Total Internal Failure Cost Appearing

question 74

Multiple Choice

$\begin{array}{l}\text { Eagan Company's quality cost report is to be based on the following data: }\\\begin{array} { | l | r | } \hline \text { Quality training } & \$ 75,000 \\\hline \text { Lost sales due to poor quality } & \$ 94,000 \\\hline \text { Test and inspection of in-process goods } & \$ 37,000 \\\hline \text { Test and inspection of incoming materials } & \$ 65,000 \\\hline \text { Disposal of defective products } & \$ 86,000 \\\hline \text { Quality data gathering, analysis, and reporting } & \$ 92,000 \\\hline \text { Net cost of spoilage } & \$ 27,000 \\\hline \text { Supervision of testing and inspection activities } & \$ 10,000 \\\hline \text { Product recalls } & \$ 38,000 \\\hline\end{array}\end{array}$
- What will be the total internal failure cost appearing on the quality cost report?

• A) $64,000.
• B) $113,000.
• C) $121,000.
• D) $124,000.

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Definitions:

Measurements

Quantitative data obtained by measuring objects or events using standard units.

Percentile

In statistics, this term refers to the threshold under which a specific percentage of data within a collection is observed.

Interquartile Range

The difference between the 75th and 25th percentiles of a dataset, representing the spread of the middle 50% of the data.

Tchebysheff's Theorem

A statistical theorem stating that for any distribution, the proportion of outcomes within k standard deviations of the mean is at least 1-1/k^2 for k>1.