Prevention Costs

Cost of Quality
The total costs incurred to ensure good quality or rectify poor quality. By enhancing quality, managers can reduce costs and boost profits. These costs are categorized into prevention, appraisal, internal failure, and external failure costs.
Prevention Costs
Expenditures incurred by an organization to prevent defects in its products or services, which form an integral part of the Cost of Quality and are sometimes related to Environmental Costs.

Accounting Terms Lexicon

Discover comprehensive accounting definitions and practical insights. Empowering students and professionals with clear and concise explanations for a better understanding of financial terms.