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If the normal cost of the raw material is $500 and the same raw material of high quality is $800. Then for the prevention cost (quality cost), is it $800 or $300?
My question assumes that the company buys the high quality raw materials in order to minimise the number of rejected products.
Buying poor material costs $500. To ensure that flawed material does not entet production costs an additional $300, so the cost of preventing problems with material is $300.