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11 Cards in this Set
- Front
- Back
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External Failure Costs |
costs incurred as a result of delivering defective goods to costumers |
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Internal Failure Costs |
costs incurred in correcting defects before the products reach the customer |
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Prevention Costs |
costs incurred to avoid nonconforming products |
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difference between prevention costs and failure costs |
prevention costs include a bunch of factors to avoid the actual defective product from being made, while failure costs are incurred once a defective product is made |
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appraisal costs |
costs incurred to identify nonconforming products produced, in spite of prevention cost expenditures |
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voluntary costs |
costs that are a function of managerial discretion, such as prevention and appraisal costs |
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failure costs |
costs that come from correcting defects in nonconforming products |
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total quality management |
managing quality costs to ensure the highest level of costumer satisfaction |
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Quality |
the degree to which products or services conform to design specifications |
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total cost of quality |
the sum of voluntary costs plus failure costs |
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quality cost report |
typically lists the company's quality costs and analyzes horizontally each item as a percentage of the total cost |
