An inspector at a shirt manufacturer discovered that over fifteen hundred shirts were manufactured with incorrect buttons.The manufacturer sold the shirts at 70% of the normal price to a retailer who specializes in "factory seconds." The revenue lost by the manufacturer is considered:

Question

Quizplus · Accepted Answer

Internal failure costs are incurred when defects are discovered before the product is shipped to the customer, such as the cost of selling defective shirts at a reduced price.

An Inspector at a Shirt Manufacturer Discovered That Over Fifteen