The cost of improved production equipment and production processes is a(n):
A)external failure cost.
B)internal failure cost.
C)prevention cost.
D)appraisal cost.

Question

Quizplus · Accepted Answer

The cost of improved production equipment and production processes is a type of prevention cost. Prevention costs are incurred to prevent defects and errors from occurring in the first place, and include activities such as training, quality planning, and process improvement. Investing in better equipment and processes is a way to prevent defects and improve quality, so it falls under the category of prevention costs.

The Cost of Improved Production Equipment and Production Processes Is