Microlesson · 5-min read

Quality Control Cost

# Quality Control Cost

## Definition

Quality Control Cost is the cost of all the resources used for quality control purposes.

## Key Points

It will be directly given in the question (you do not have to compute it).
It is added after Net Factory Cost and before arriving at Cost of Production.
It includes salaries of quality control staff, testing materials, depreciation of testing equipment, etc.

## Position in Cost Sheet

```

Net Factory Cost

+ Quality Control Cost

+ Research & Development Cost

+ Admin OH related to production

+ Primary Packaging

− Sale of scrap / by-product

= Cost of Production

```

Worked example

### Example 1

Example: If Net Factory Cost = ₹5,00,000, Quality Control Cost given in question = ₹25,000, R&D Cost = ₹15,000, and Primary Packaging = ₹10,000:

Cost of Production = 5,00,000 + 25,000 + 15,000 + 10,000 = ₹5,50,000

Trying to compute QC cost from items in the question — it is always given as a single figure.
Adding QC cost before factory cost (it comes after net factory cost).
Treating QC cost as admin OH.

Reference:

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