Research on quality profit and loss analysis model

This article introduces the concept of quality level and combines quality costs and quality revenue organically. Models have been established based on the analysis of the relationship between costs and revenue and quality level. The article takes the maximum quality profit and loss as the ultimate index in deciding best quality level. Taking ZX´s product information in domestic system as an example, the article analyzes the quality profit and loss model and proves that best quality level is neither 100% nor the minimum total quality costs put forward by traditional models, but the maximum quality profit and loss. The quality profit and loss model overcomes both the weakness of the minimum total quality cost in traditional models and 100% qualified in zero defects theory, and revises the relationship between costs and quality level. In addition, this article made comparative analysis of traditional models and the quality profit and loss model by using real data of the enterprise. And it proves that the quality profit and loss model is more appropriate for practical situation of total quality cost management in the circumstance of modern production management. It has directive function to the enterprise´s quality cost management.