The costs of quality that are incurred in detecting units of product that do not conform to
product specifications are referred to as

Answer (B) is correct.
The categories of quality costs include conformance costs (prevention
and appraisal) and nonconformance costs (internal failure and external
failure). Appraisal costs embrace such activities as statistical quality
control programs, inspection, and testing. Thus, the cost of detecting
nonconforming products is an appraisal cost.