Quality-Related Costs Generally Fall into Four Different Categories, Which Include

question 99

Multiple Choice

Quality-related costs generally fall into four different categories, which include all of the following except

• A)prevention costs.
• B)appraisal costs.
• C)internal failure costs.
• D)transportation costs.

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Definitions:

Cost of Goods Sold

The historical cost of products sold as reported in the income statement.

Gross Profit

The difference between revenue and the cost of goods sold, indicating the profitability of a company's core activities.

Goods Available for Sale

The total quantity of goods that a company has in its stock ready to sell at the end of a financial period.

Absorption Costing

An accounting method that includes all manufacturing costs — direct materials, direct labor, and both variable and fixed overhead — in the cost of a product.