An example of an internal failure cost in a Cost-of-Quality (COQ) reporting system is:
A) Maintenance.
B) Inspection.
C) Rework.
D) Product recalls.
E) Contribution margin foregone in terms of lost sales.

Question

Quizplus · Accepted Answer

Rework refers to the cost of correcting defects in a product or service that were not detected during production or prior to delivery to the customer. This is an internal failure cost, as it indicates a failure in the organization's quality control measures.

An Example of an Internal Failure Cost in a Cost-Of-Quality