Cornerstones of Cost Management 2nd Edition by Don Hansen ,Maryanne Mowen

Exercise 35

Classification of Quality Costs
Classify the following quality costs as prevention, appraisal, internal failure, or external failure. Also, label each cost as variable or fixed with respect to sales volume.
1. Quality engineering
2. Scrap
3. Product recalls
4. Returns and allowances because of quality problems
5. Sales data re-entered because of keying errors
6. Supervision of in-process inspection
7. Quality circles
8. Component inspection and testing
9. Quality training
10. Reinspection of reworked product
11. Product liability
12. Internal audit assessing the effectiveness of quality system
13. Disposal of defective product
14. Downtime attributable to quality problems
15. Quality reporting
16. Proofreading
17. Correction of typing errors
18. In-process inspection
19. Process controls
20. Pilot studies