The cost of labor time required to rework defective units would be classified as a(n):
A) prevention cost.
B) appraisal cost.
C) internal failure cost.
D) external failure cost.

Question

Quizplus · Accepted Answer

The cost of labor time required to rework defective units is considered as an internal failure cost because it arises due to defects in the products that have already been produced and must be corrected before they can be sold or shipped to customers. Internal failure costs are costs incurred to fix defects found before products are shipped or sold.

The Cost of Labor Time Required to Rework Defective Units