Acceptable Quality Level - AQL

View more Business & Finance videos

A statistical measurement of the maximum number of defective goods considered acceptable in a particular sample size. If the acceptable quality level (AQL) is not reached for a particular sampling of goods, manufacturers will review the various parameters in the production process to determine the areas causing the defects.

The AQL is an important statistic to companies seeking a Six Sigma level of quality control.

Investopedia Says:

The AQL of a product can vary from industry to industry. For example, medical products are more likely to have a more stringent AQL because defective products can result in health risks. Companies have to weigh the added cost associated with the stringent testing and potentially higher spoilage due to a lower defect acceptance with the potential cost of a product recall.

Related Links:
Do you know how your companies really make their money? Learn to assess the systems by which businesses generate their revenue. Getting To Know Business Models
We go over these methods of calculating this component of the balance sheet, and how the choice affects the bottom line. Inventory Valuation For Investors: FIFO And LIFO
We look at a retailer's inventory turnaround times, its receivables as well as its collection period. Measuring Company Efficiency
Flooding the market with cheap products can mean job losses and even market collapse - but dumping isn't as threatening as it seems. Do Cheap Imported Goods Cost Americans Jobs?