2...Eade Company\'s quality cost report is to be based on the following data: Li

Question

2...Eade Company's quality cost report is to be based on the following data: Liability arising from defective products $37,000 Lost sales due to poor quality $14,900 Test and inspection of in-process goods $19,400 Quality circles $70,100 Net cost of spoilage $68,300 Debugging software errors $57,500 Rework labor and overhead $27,100 Final product testing and inspection $47,600 Statistical process control activities $45,600 What would be the total internal failure cost appearing on the quality cost report? $152,900 $42,000 $94,500 $91,800

Explanation / Answer

Internal failiure = Liability from defective products + Debugging software

= 37000 + 57500

= 94500

Thus answer will be $94500

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