Question

From the schedule below provided for quality control activities, determine the appraisal costs: Quality control activities Activity cost Finished goods inspection S12,000 Product design S22,000 Rework S8.900 Processing returned products S21,000 Training of machine operators S25,000 Process audit S32.000 a. $33,000 b. $66,000 c. $44,000 d. $29,900

Answer 1

Answer:

Appraisal Costs:Appraisal Costs are specific category of Quality Control costs.Process audits51,400Training of machine operators27,300Preventative maintenance29,300Product design41,600Finished goods inspection22,3001,71,900Answer is 171900/-Internal Failure Costs:Internal Failure Costs are costs incurred to remove defects from products before shipping them to customerScrap processing (disposal)25,300Rework5,20030,500Answer is 30500/-External Failure Costs:If Defective products have been shipped to customers, external failure costs ariseWarranty work8,100Processing returned products20,10028,200Answer is 28200/-