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

Question

Eade Company's quality cost report is to be based on the following data:   Liability arising from defective products $34,500      Lost sales due to poor quality $20,600      Test and inspection of in-process goods $20,700      Quality circles $63,200      Net cost of spoilage $59,900      Debugging software errors $61,500      Rework labor and overhead $26,600      Final product testing and inspection $41,000      Statistical process control activities $42,300    What would be the total appraisal cost appearing on the quality cost report? Eade Company's quality cost report is to be based on the following data:

Explanation / Answer

Appraisal costs are associated with measuring and monitoring activities related to quality. These costs are associated with the suppliers’ and customers’ evaluation of purchased materials, processes, products, and services to ensure that they conform to specifications.

  Test and inspection of in-process goods

$20,700

  Quality circles

63200

  Final product testing and inspection

41000

  Statistical process control activities

$42,300

Total

$167200

  Test and inspection of in-process goods

$20,700

  Quality circles

63200

  Final product testing and inspection

41000

  Statistical process control activities

$42,300

Total

$167200

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