Table of contents

1. Introduction to Accounting1h 21m
2. Transaction Analysis1h 13m
3. Accrual Accounting Concepts2h 38m
4. Merchandising Operations2h 30m
5. Inventory1h 55m
6. Internal Controls and Reporting Cash1h 16m
7. Receivables and Investments3h 8m
8. Long Lived Assets5h 1m
9. Current Liabilities2h 19m
10. Time Value of Money1h 23m
- Time Value of Money Equations
  35m
- Using Time Value of Money Tables
  47m
11. Long Term Liabilities2h 45m
12. Stockholders' Equity2h 15m
13. Statement of Cash Flows2h 24m
14. Financial Statement Analysis5h 25m
15. GAAP vs IFRS56m

1. Introduction to Accounting

Types of Accounting

Financial Accounting

1. Introduction to Accounting

Types of Accounting

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Multiple Choice

Which of the following would be classified as an internal failure cost on a quality cost report?

Cost of training employees in quality control

Cost of inspecting finished goods

Cost of warranty repairs for customers

Cost of reworking defective products before shipment

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Verified step by step guidance

Understand the concept of quality cost categories: Quality costs are typically divided into four categories—prevention costs, appraisal costs, internal failure costs, and external failure costs. Internal failure costs are incurred when defects are detected before the product is shipped to the customer.

Analyze the options provided: Each option represents a different type of cost. For example, training employees in quality control is a prevention cost, inspecting finished goods is an appraisal cost, and warranty repairs for customers are external failure costs.

Focus on the definition of internal failure costs: These costs arise from defects found during the production process but before the product is delivered to the customer. Examples include reworking defective products, scrap, and downtime caused by defects.

Identify the correct classification: Among the options, 'Cost of reworking defective products before shipment' fits the definition of internal failure costs because it involves addressing defects before the product reaches the customer.

Conclude the reasoning: The other options do not fit the internal failure cost category. Training employees is a prevention cost, inspecting finished goods is an appraisal cost, and warranty repairs are external failure costs. Therefore, the correct classification is 'Cost of reworking defective products before shipment.'