costs.
Answer: True False
206) Internal failure costs occur when poor- quality goods or services are not detected until after delivery to
customers.
Answer: True False
207) Product testing is a prevention cost.
Answer: True False
208) An example of an appraisal cost is the cost of automating the production process.
Answer: True False
209) The cost of training employees would be classified as an external failure cost.
Answer: True False
210) An example of a prevention cost is the cost of redesigning the product to reduce its complexity.
Answer: True False
211) Prevention and appraisal costs are sometimes referred to as "conformance costs."
Answer: True False
212) The production cost of a unit found to be defective during inspection is an appraisal cost.
Answer: True False
213) The production cost of a unit found to be defective during inspection is an internal failure cost.
Answer: True False
MULTIPLE CHOICE. Choose the one alternative that best completes the statement or answers the question.
214) Which of the following cost items should be classified as a prevention cost on a cost of quality report?
A) Net cost of spoiled units B) Supervision of quality inspections
C) Technical support provided to employees D) Warranty expenses on defective products
Answer: C
215) Which of the following cost items should be classified as an internal failure cost on a cost of quality report?
A) Training for quality control employees B) Customer returns of defective products
C) Patent cost for a new product D) Net cost of scrap
Answer: D
216) Which of the following cost items should be classified as an external failure cost on a cost of quality report?
A) Technical support provided to suppliers B) Net cost of scrap
C) Customer returns of defective products D) Supplies used in the quality inspection program
Answer: C
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217) Warranty costs are classified as
A) Internal Failure Costs. B) Prevention Costs.
C) Appraisal Costs. D) External Failure Costs.
Answer: D
218) If a company were to increase its appraisal costs by inspecting more units as the units are completed, the
company's internal failure costs
A) would usually decrease. B) would usually increase.
C) would usually remain the same. D) could not be predicted.
Answer: B
219) If a company were to increase its appraisal costs by inspecting more units as the units are completed, the
company's external failure costs
A) would usually decrease. B) would usually increase.
C) would usually remain the same. D) could not be predicted.
Answer: A
220) The cost of supplier evaluation from a supplier would be classified as a(n)
A) prevention cost. B) appraisal cost.
C) internal failure cost. D) external failure cost.
Answer: A
221) The cost of maintaining testing equipment would be classified as a(n)
A) prevention cost. B) appraisal cost.
C) internal failure cost. D) external failure cost.
Answer: A
222) The cost of downtime caused by quality problems with the raw materials would be classified as a(n)
A) prevention cost. B) appraisal cost.
C) internal failure cost. D) external failure cost.
Answer: C
223) The cost of fixing defective units found during the quality inspections would be classified as a(n)
A) prevention cost. B) appraisal cost.
C) internal failure cost. D) external failure cost.
Answer: C
224) The cost of training quality control supervisors would be classified as a(n)
A) prevention cost. B) appraisal cost.
C) internal failure cost. D) external failure cost.
Answer: B
225) Which of the following is one of the four cost categories typically found on a cost of quality report?
A) Prevention costs B) Development costs
C) Marketing costs D) Inventory failure costs
Answer: A
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226) Which of the following refers to costs incurred in detecting poor quality goods or services?
A) Internal failure costs B) External failure costs
C) Prevention costs D) Appraisal costs
Answer: D
227) What costs are incurred to avoid poor quality goods or services in the first place?
A) Appraisal costs B) Prevention costs
C) Internal failure costs D) External costs
Answer: B
228) The costs incurred when poor quality goods or services are detected and corrected before delivery to customers
are called
A) internal failure costs. B) prevention costs.
C) appraisal costs. D) external failure costs.
Answer: A
229) The cost of inspection at various stages of production is an example of a(n)
A) internal failure cost. B) prevention cost.
C) appraisal cost. D) external failure cost.
Answer: C
230) The cost of warranty work is an example of a(n)
A) external failure cost. B) appraisal cost.