Listed below are selected line items from the cost-of-quality report for Company B for last month Category:

What is Company B’s total prevention and appraisal cost for last month?

A. US$786
B. US$1,154

C. US$1,940

D. US$2,665

Answer (C) is correct. Prevention costs are incurred to prevent defects from occurring. An example is equipment maintenance. Appraisal costs are incurred to detect defective output during and after the production process. An example is product testing. Thus, total prevention and appraisal cost for the month equals US $1,940 (US$1,154 + US $786).