Which of the following is considered a cost of quality?
A) external failure costs
B) opportunity costs
C) sunk costs
D) contingent liabilities

Question

Quizplus · Accepted Answer

External failure costs refer to the costs incurred by the organization after the product has been delivered and the customer complains about it or returns it. These costs include rework costs, warranty costs, and customer service costs. External failure costs are considered a cost of quality because they represent the cost of not meeting customer expectations and quality standards. Option B (opportunity costs), C (sunk costs), and D (contingent liabilities) are not considered costs of quality.

Which of the Following Is Considered a Cost of Quality