Question

Classify the following quality costs as prevention costs, appraisal costs, internal failure costs, or external failure costs:

1. Internal audit to ensure that quality guidelines and processes are being followed

2. Repairing products in the field
3. Providing engineering assistance to selected suppliers to improve their product quality

4. Correcting a design error discovered during product development

5. Settling a bodily injury law suit caused by a defective product

6. Customer complaint department
7. Quality control circles

8. Continuing supplier verification

9 Redesigning a product to eliminate a product defect

10 Lost sales because of product quality concerns

Answer 1

Ans:

Costs of quality or quality costs does not mean the use of expensive or very highly quality material to manufacture a product. The term refers to the costs that are incurred to prevent, detect and remove defects from products. Quality costs are categorized into four main types. These are:

1. Prevention costs
2. Appraisal costs
3. Internal failure costs
4. External failure costs.

These four types of quality costs are briefly explained below:

1. Prevention costs: It is much better to prevent defects rather than finding and removing them from products.

2. Appraisal costs: (also known as inspection costs) are those cost that are incurred to identify defective products before they are shipped to customers.

3. Internal failure costs: Internal failure costs are those costs that are incurred to remove defects from the products before shipping them to customers.

4. External failure costs: If defective products have been shipped to customers, external failure costs arise.

Prevention costs: 7, 3,

Appraisal costs: 9, 1, 8,

Internal failure costs: 4.

External failure costs: 10, 6,2, 5,