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Measuring quality costs is becoming an increasingly more important task for accountants. This is especially true in light of new definitions and goals of quality programs, which are primarily to produce goods and services with zero defects while preventing problems, improving reliablity and eliminating waste. This article examines how accountants can provide cost information using the traditional quality cost model along with expected value techniques so that managers may make more effective decisions to accomplish these goals.

The purpose of this paper is to find out the behavior patterns of different quality cost categories to enable us to take the right decisions in allocating resources for reducing quality costs.

Costs of quality, existing in a small‐scale industry in India, in the financial year 2006‐2007, were found out. At the start of the financial year 2007‐2008 a quality cost program was implemented in that organization and more resources were allocated for prevention and appraisal cost activities. Subsequently, the costs of quality related to the financial year 2007‐2008 and 2008‐2009 were found out. Based on the quality cost data of three years, co‐relation co‐efficient between the different quality cost categories were calculated.

The co‐relation co‐efficient between different quality cost categories suggest that by increasing the efforts towards prevention and appraisal activities, costs of non conformance decrease. Furthermore, there exists positive co‐relation within costs of conformance and between costs of non conformance.

In the competitive modern world, small scale organizations have limited resources. They do not have funds to hire consultants. So, the behaviour patterns of quality cost categories help these organizations to allocate precious resources more effectively and result in the reduction of quality costs thereby improving profitability.

The determination of quality costs on a production line is discussed. An approach to quality costs analysis is developed and illustrated employing a particular production line. This line which is devoted to the assembly and testing of an advanced computer system is fully described. A diagrammatic model of the production line is presented which displays points on the line at which quality costs can arise and the nature of these costs. A quality cost model for this line incorporating prevention, appraisal and failure cost elements is presented and their estimation discussed. It is argued that the modelling concept developed can provide a general framework for the isolation of quality costs.

This paper examines the components of quality cost (internal failure, external failure, appraisal cost, and prevention cost) in the context of two key manufacturing inputs, materials and machines; the concept is also explained for the company as a whole. The purpose of this research is to analyze the variables that impact quality in a manufacturing environment. There are three major findings in this research. First, there is an inverse relationship between appraisal cost plus prevention cost and failure cost. Second, the relationship between appraisal cost plus prevention cost and quality is positive. Finally, failure cost is negatively correlated with quality. This analysis also revealed a strong relationship between appraisal cost plus prevention cost and quality for material input, machine input, and the company. The results indicate that as the appraisal cost plus the prevention cost increases, quality improves and failure cost decreases.

The purpose of this paper is to develop two models in the field of cost of quality. One model would be for estimating/calculating cost of quality and the second model would be for implementing cost of quality system in an industry.

Although most industries are aware of the benefits of cost of quality, only a few of them are using it in their organization because they do not know how to calculate and implement same. Hence, to help those industries, simple models are proposed for calculating cost of quality and for implementing cost of quality system.

Cost of quality models are developed and later on they are validated through a case study. It is observed that by implementing same, the cost of quality reduced significantly in the chosen industry.

Average industries do not have resources to hire the services of consultants to implement cost of quality systems in their industries, therefore the simple models proposed in the paper will be of great value to them.

A COQ model plays an important role in the total quality cost survey. Based on the methodology of continuous quality improvement, a dynamic COQ model for different quality level is developed in this paper. A quality level is defined by Six Sigma level that can be measured by two indicators. The relationships among the four major quality costs are analyzed. Finally, the curves of total quality costs for different quality level are presented.

The purpose of this paper is to propose a model for analysing the influence of costs of quality.

A model is designed by using a causal loop diagram and is analysed through a system dynamics approach. The model simulation is prepared by Vensim software.

Prevention and appraisal costs are the two effective cost factors. The model represented in this paper reveals that prevention costs have the most effect on total cost of quality and especially external failure costs. Hence, in order to achieve the customer expected quality level, prevention and appraisal costs should be considered.

Calculating and measuring non‐conformance costs is very difficult in organizations and some errors and mistakes may happen.

A system dynamics approach can analyse and measure the amount of prevention cost effects on cost of quality in different organizations.

The proposed methodology demonstrates the use of an innovative approach in developing a cost of quality concept and constructing a practical framework for system dynamics in a real case.

Discussing quality as a series of customer‐supplier relationships, the writer shows the need for cost of quality evaluation in service industries and outlines the differences between cost of quality evaluation in service and other industries. The use of cost of quality as a tool for quality improvement is discussed.

Lyn Stolber concludes her two‐part series on quality costs by examining alternative and complementary approaches to reducing quality‐related costs.

Quality costs have been discussed widely in the literature. This discussion has not always agreed and it is possible to identify two basic schools of thought; one asserts the existence of a minimal level of quality cost for a given level of prevention and appraisal activities, and the other asserts that through prevention quality improvement is constant. This paper summarises these positions and outlines a behaviour model of quality costs that unifies and clarifies them. The behaviour model is based on the consideration of the cumulative effects of prevention. Ceteris paribus, continuous prevention activities should permit quality improvements whilst at the same time reducing the costs necessary to obtain them. The behaviour model introduces the effect of external quality requirements in an attempt to explain how, over time, quality improvement efforts do not necessarily result in decreased quality costs as customers’ quality requirements rise over the same period.