How do you calculate defect cost?

Multiply defective boards by per-board cost and the capture rate, then add fixed overhead. With 100 boards at $45, an 80% capture rate, and $250 fixed, you get $3,600 variable plus $250, totaling $3,850.

What does the capture rate do?

It scales the variable cost to the share you actually book in your quality accounting. At 80%, the $4,500 raw variable cost is captured as $3,600 before fixed overhead is added.

Why include fixed quality overhead?

Inspection labor, gauges, and lab time run whether you scrap 10 boards or 1,000. Adding the fixed $250 gives a fully loaded defect cost rather than just the variable scrap.

What is a good defect cost per board?

There is no universal number; it depends on board type and where in the process the defect is caught. The example's $38.50 fully loaded per board is a useful internal benchmark to drive down over time.

Defect cost vs scrap rate?

Scrap rate is a count or percentage; defect cost converts it to dollars including rework and overhead, which is what a capital request for an edge guide or core fix actually needs.

How do I lower this number?

Cut defective board count at the source, reduce per-board rework cost through faster recovery, or spread fixed overhead across more good output. The model shows which lever moves the total most.

Gypsum, Drywall & Interior Panel Manufacturing calculator

Defect Cost Calculator

Every drywall defect, whether a delaminated paper face, a soft core edge, or a length out of tolerance, carries a cost in rework, scrap, and the quality system that catches it. Defect Cost rolls those together: it takes the count of defective boards, multiplies by the rework or scrap cost each one carries, scales that by the share of cost you actually capture in your accounting, and adds the fixed quality overhead that runs regardless of volume. Plant controllers and quality managers use it to put a dollar figure on a defect mode and to justify spend on inspection, edge guides, or core chemistry. A defect rate that looks small in boards can be large in dollars.

What this calculator does

Estimate total defect cost for a board production run by combining defective board count, rework or scrap cost per board, quality cost capture rate, and fixed quality overhead.
Use it at a quality cost review to quantify the cost of non-conforming boards and build a business case for a defect reduction investment.
It multiplies defective boards by per-board rework or scrap cost and a capture rate for variable cost, then adds fixed quality overhead for a total dollar figure.

Formula used

Variable defect cost = defective boards x rework or scrap cost per board x quality cost capture rate
Total defect cost = variable defect cost + fixed quality overhead

Inputs explained

Defective boards:
Rework or scrap cost per board:
Quality cost capture rate:
Fixed quality overhead:

How to use the result

Use it when costing a specific defect mode or building the business case for a quality improvement.
It assumes one blended cost per board; a mix of cheap trim rejects and expensive full-scrap delaminations needs separate runs to stay accurate.

Common questions

How do you calculate defect cost? Multiply defective boards by per-board cost and the capture rate, then add fixed overhead. With 100 boards at $45, an 80% capture rate, and $250 fixed, you get $3,600 variable plus $250, totaling $3,850.
What does the capture rate do? It scales the variable cost to the share you actually book in your quality accounting. At 80%, the $4,500 raw variable cost is captured as $3,600 before fixed overhead is added.
Why include fixed quality overhead? Inspection labor, gauges, and lab time run whether you scrap 10 boards or 1,000. Adding the fixed $250 gives a fully loaded defect cost rather than just the variable scrap.
What is a good defect cost per board? There is no universal number; it depends on board type and where in the process the defect is caught. The example's $38.50 fully loaded per board is a useful internal benchmark to drive down over time.
Defect cost vs scrap rate? Scrap rate is a count or percentage; defect cost converts it to dollars including rework and overhead, which is what a capital request for an edge guide or core fix actually needs.

Last reviewed 2026-05-12.