- What Will Be the Total External Failure Cost Appearing

question 199

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 external failure cost appearing on the quality cost report?

• A) $124,000.
• B) $132,000.
• C) $245,000.
• D) $524,000.

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Definitions:

Fishing Trade

The industry or business of catching, processing, and selling fish and seafood.

European Crop Failures

Periods when agricultural production in Europe significantly declined due to natural conditions, affecting food supplies and economies.

Lucrative

Refers to a venture or activity that is highly profitable.

Slave Trade

The historical practice of trading in enslaved people, particularly prevalent across the Atlantic Ocean from the 16th to the 19th centuries.