Question 1

Which of the following would be classified as an appraisal cost on a quality cost report?

Accepted Answer

A)   Maintenance of test equipment.
B)   Re-entering data because of keying errors.
C)   Debugging software errors.
D)   Warranty repairs and replacements.E) None of the above
F) C) and D)

Question 2

Gadsen Company's quality cost report is to be based on the following data:
  Required:
Prepare a Quality Cost Report in good form with separate sections for prevention costs, appraisal costs, internal failure costs, and external failure costs.

Accepted Answer

The answer of Gadsen Company's quality cost report is to...

Question 3

Fabrick Company's quality cost report is to be based on the following data:  What would be the total prevention cost appearing on the quality cost report?

Accepted Answer

A)   $101,000
B)   $72,000
C)   $73,000
D)   $96,000E) B) and C)
F) A) and D)

Question 4

The four categories of quality costs in a quality cost report are:

Accepted Answer

A)   external failure, product liability, prevention, and carrying.
B)   external failure, internal failure, prevention, and appraisal.
C)   warranty, product liability, prevention, and appraisal.
D)   warranty, product liability, training, and appraisal.E) None of the above
F) All of the above

Question 5

Which of the following would be classified as a prevention cost on a quality cost report?

Accepted Answer

A)   Debugging software errors.
B)   Quality training.
C)   Test and inspection of incoming materials.
D)   Cost of field servicing and handling complaints.E) None of the above
F) B) and D)

Question 6

Which of the following would be classified as an appraisal cost on a quality cost report?

Accepted Answer

A)   Returns and allowances arising from quality problems.
B)   Downtime caused by quality problems.
C)   Test and inspection of in-process goods.
D)   Cost of field servicing and handling complaints.E) B) and D)
F) All of the above

Question 7

Eagleson Company's quality cost report is to be based on the following data:  What would be the total internal failure cost appearing on the quality cost report?

Accepted Answer

A)   $155,000
B)   $150,000
C)   $96,000
D)   $107,000E) B) and C)
F) C) and D)

Question 8

Galaviz Company's quality cost report is to be based on the following data:
  Required:
Prepare a Quality Cost Report in good form with separate sections for prevention costs, appraisal costs, internal failure costs, and external failure costs.

Accepted Answer

The answer of Galaviz Company's quality cost report is to...

Question 9

The cost of labor time required to rework defective units would be classified as a(n) :

Accepted Answer

A)   prevention cost.
B)   appraisal cost.
C)   internal failure cost.
D)   external failure cost.E) A) and B)
F) A) and C)

Question 10

Which of the following would be classified as an appraisal cost on a quality cost report?

Accepted Answer

A)   Quality improvement projects.
B)   Supplies used in testing and inspection.
C)   Audits of the effectiveness of the quality system.
D)   Quality data gathering, analysis, and reporting.E) None of the above
F) A) and D)

Question 11

Harwood Company's quality cost report is to be based on the following data:
  Required:
Prepare a Quality Cost Report in good form with separate sections for prevention costs, appraisal costs, internal failure costs, and external failure costs.

Accepted Answer

The answer of Harwood Company's quality cost report is to...

Question 12

Fabrick Company's quality cost report is to be based on the following data:  What would be the total external failure cost appearing on the quality cost report?

Accepted Answer

A)   $94,000
B)   $480,000
C)   $104,000
D)   $306,000E) All of the above
F) None of the above

Question 13

Quality is achieved when a product or service contains all of the features that a customer would expect, and when that product or service performs in such a way that the customer is satisfied.

Accepted Answer

A) True 
 B)False

Question 14

Which of the following would be classified as a prevention cost on a quality cost report?

Accepted Answer

A)   Cost of field servicing and handling complaints.
B)   Warranty repairs and replacements.
C)   Systems development.
D)   Rework labor and overhead.E) A) and C)
F) B) and D)

Question 15

In preparing a quality cost report, the cost of employee's time spent in quality circles is part of:

Accepted Answer

A)   prevention costs.
B)   appraisal costs.
C)   internal failure costs.
D)   external failure costs.E) A) and B)
F) A) and C)

Question 16

Fackler Company's quality cost report is to be based on the following data:  What would be the total appraisal cost appearing on the quality cost report?

Accepted Answer

A)   $130,000
B)   $152,000
C)   $146,000
D)   $219,000E) A) and D)
F) None of the above

Question 17

To minimize its total quality costs, a company should usually try to redistribute its quality costs more toward prevention and appraisal.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following would be classified as an internal failure cost on a quality cost report?

Accepted Answer

A)   Quality improvement projects.
B)   Supervision of testing and inspection activities.
C)   Debugging software errors.
D)   Warranty repairs and replacements.E) C) and D)
F) B) and D)

Question 19

Eaglin Company's quality cost report is to be based on the following data:  What would be the total prevention cost appearing on the quality cost report?

Accepted Answer

A)   $55,000
B)   $30,000
C)   $62,000
D)   $133,000E) A) and B)
F) A) and C)

Question 20

The most effective way to minimize quality costs while maintaining high quality is to avoid having quality problems in the first place. This is the reason for incurring appraisal costs.

Accepted Answer

A) True 
 B)False

Exam 12: Cost of Quality

Which of the following would be classified as an internal failure cost on a quality cost report?

Correct AnswerverifiedShow Answer

To minimize its total quality costs, a company should usually try to redistribute its quality costs more toward prevention and appraisal.

Correct AnswerverifiedShow Answer

In preparing a quality cost report, the cost of employee's time spent in quality circles is part of:

Correct AnswerverifiedShow Answer

Fackler Company's quality cost report is to be based on the following data: What would be the total appraisal cost appearing on the quality cost report?

Correct AnswerverifiedShow Answer

Gadsen Company's quality cost report is to be based on the following data: Required: Prepare a Quality Cost Report in good form with separate sections for prevention costs, appraisal costs, internal failure costs, and external failure costs.

Correct AnswerverifiedShow Answer

Fabrick Company's quality cost report is to be based on the following data: What would be the total prevention cost appearing on the quality cost report?

Correct AnswerverifiedShow Answer

Which of the following would be classified as a prevention cost on a quality cost report?

Correct AnswerverifiedShow Answer

The four categories of quality costs in a quality cost report are:

Correct AnswerverifiedShow Answer

Quality is achieved when a product or service contains all of the features that a customer would expect, and when that product or service performs in such a way that the customer is satisfied.

Correct AnswerverifiedShow Answer

Fabrick Company's quality cost report is to be based on the following data: What would be the total external failure cost appearing on the quality cost report?

Correct AnswerverifiedShow Answer

Which of the following would be classified as an appraisal cost on a quality cost report?

Correct AnswerverifiedShow Answer

Harwood Company's quality cost report is to be based on the following data: Required: Prepare a Quality Cost Report in good form with separate sections for prevention costs, appraisal costs, internal failure costs, and external failure costs.

Correct AnswerverifiedShow Answer

Eaglin Company's quality cost report is to be based on the following data: What would be the total prevention cost appearing on the quality cost report?

Correct AnswerverifiedShow Answer

The cost of labor time required to rework defective units would be classified as a(n) :

Correct AnswerverifiedShow Answer

Which of the following would be classified as an appraisal cost on a quality cost report?

Correct AnswerverifiedShow Answer

The most effective way to minimize quality costs while maintaining high quality is to avoid having quality problems in the first place. This is the reason for incurring appraisal costs.

Correct AnswerverifiedShow Answer

Galaviz Company's quality cost report is to be based on the following data: Required: Prepare a Quality Cost Report in good form with separate sections for prevention costs, appraisal costs, internal failure costs, and external failure costs.

Correct AnswerverifiedShow Answer

Which of the following would be classified as an appraisal cost on a quality cost report?

Correct AnswerverifiedShow Answer

Eagleson Company's quality cost report is to be based on the following data: What would be the total internal failure cost appearing on the quality cost report?

Correct AnswerverifiedShow Answer

Which of the following would be classified as a prevention cost on a quality cost report?

Correct AnswerverifiedShow Answer

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