Question 1

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 2

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

Question 4

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

Question 5

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 6

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)  $306,000 
A)  $94,000 
B)  $480,000 
C)  $104,000 
D)  $306,000

Question 7

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

Question 8

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. 
A)  Maintenance of test equipment. 
B)  Re-entering data because of keying errors. 
C)  Debugging software errors. 
D)  Warranty repairs and replacements.

Question 9

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. 
A)  Debugging software errors. 
B)  Quality training. 
C)  Test and inspection of incoming materials. 
D)  Cost of field servicing and handling complaints.

Question 10

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

Question 11

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. 
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.

Question 12

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. 
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.

Question 13

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

Question 14

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

Question 15

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 16

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. 
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.

Question 17

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 18

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)  $219,000 
A)  $130,000 
B)  $152,000 
C)  $146,000 
D)  $219,000

Question 19

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

Question 20

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

Exam 12: Cost of Quality

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

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.

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?

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

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.

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?

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

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

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

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

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

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

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?

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.

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.

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

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.

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?

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

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?

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