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Managerial Accounting

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Cost of Quality: Paddy Hope Industries

MGRACT-SOVU1O

Paddy Hope Industries owns and operates a specialty bakery making wedding cakes, cupcakes, and specialty breads. Paddy has done extensive research to assess and determine the best ingredients for his baked goods and has also interviewed and researched all of his suppliers to make sure that they adhere to the highest product standards possible.

What category of costs of quality governs these activities most accurately?

A

Prevention costs.

B

Appraisal costs.

C

Internal failure costs.

D

External failure costs.