What quality costs will the J.M. Smucker Company incur from its recall of Jif peanut butter?

Photo of a jar of Jif peanut butter sitting on a countertop

The J.M. Smucker Company (Smuckers) issued a voluntary recall in 2022 for several Jif peanut butter products manufactured in its Lexington, Kentucky, manufacturing facility.  Jif peanut butter products were potentially linked to a multistate outbreak of Salmonella. Salmonella is an organism that cause serious and sometimes fatal infections in people.  This recall potentially covers millions of Jif peanut butter products, including Jif Creamy Peanut Butter, Jif Crunchy Peanut Butter, Jif Natural Peanut Butter To Go, and many more.

Several other companies issued related recalls because their products could contain the potentially-contaminated Jif peanut butter. Among these companies were Prairie City Bakery for its Peanut Butter Chocolate Chip Ooey Gooey Butter Cake and Taharka Brothers for its Peanut Butter Cup Ice Cream.

A month after the Jif peanut butter recall, Smuckers announced that the recall would cost it approximately $125 million.

View a quick tutorial video about the costs of quality at this link and then answer the following questions.

Note to instructors: This post is assignable in Pearson’s MyLab and has questions that are auto-graded.

Questions

1. Prior to the recall, what specific costs of quality could Smuckers incur in the design, production, and distribution of its Jif peanut butter products? Use your imagination.

2. What specific costs do you think that Smuckers included in its recall cost estimate of $125 million. List as many costs as you can imagine might be incurred related to the recall.

3. Classify the costs you listed for Smuckers (for both #1 and #2) by type of quality cost: prevention, appraisal, internal failure, or external failure.

Copyright 2022 Wendy M. Tietz, LLC

About Dr. Wendy Tietz, CPA, CMA, CSCA, CGMA

Dr. Wendy Tietz is a professor of accounting at Kent State University in Kent, Ohio, USA. She is also a textbook author with Pearson Education.

2 Responses to “What quality costs will the J.M. Smucker Company incur from its recall of Jif peanut butter?”

  1. Thank you so much for the cases you provide!!

    Do you have a solution page that instructors can use?

    Darlene Ely, Adjunct Accounting Professor dely@mcdaniel.edu

    Sent from my iPhone

    >

    • Dr. Wendy Tietz, CPA, CMA, CSCA, CGMA Reply September 15, 2022 at 10:54 am

      I do not provide any instructor materials for Accounting in the Headlines (unless there is a link in the blog post to request the instructor materials for a project.) For short blog posts, I do not prepare solutions for two reasons:
      1. Most posts are designed to generate discussion and there may not be one right answer. I would not want to provide “one” right solution – that would discourage conversation.
      2. I have no way to control who gets the solutions if I post them – I know some instructors use the blog posts as assignments – so I don’t want to provide answers where they are discoverable.
      But the projects – those do have instructor guides – in the blog posts for those, you will find a link to fill out to request the materials. I generally send those out about once a week.

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