Question

BC Enterprises' quality control report for August contains the following items. Gathering ,analysis, and reporting quality data $ 2,000 Inspecting raw materials received from vendors 4,000 Testing and inspecting finished products 5,000 Visiting customer sites to test products 6,000 Designing product to reduce production problems 7,000 Repairing and/or replacing products under warranty 8,000 Maintaining the equipment used to gather quality data 9,000 Cost (net) of material wasted during production 10,000 What would be the total of the nonconformance costs on the August quality control report for BC Enterprises? $27,000. $18,000. $30,000. $17,000.

Answer 1

Answer:

correct option is $18,000

Explanation:

The nonconformance costs include the cost incurred in the internal and the external failure

Out of the given costs

The total internal failure cost = Net cost of material wasted during production = $10,000

and

the total external failure cost =  Repairing and/or replacing products under warranty = $8,000

Hence,

the total nonconformance costs = $ 10,000 + $8,000 = $18,000

The correct option is $18,000