Life Cycle Costing (3) Flashcards

1
Q

Advantages of life cycle costing (profitability)

A

Helps management to assess profitability over the full life of a product

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
2
Q

Advantages of life cycle costing (develop products)

A

Can be very useful for organisations to develop products with a relatively short life, where it may be possible to estimate sales volumes and prices with reasonable accuracy

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
3
Q

Advantages of life cycle costing (earlier)

A

The life cycle concept results in earlier actions to generate more revenue or to lower costs than otherwise might be considered

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
4
Q

Advantages of life cycle costing (better decisions)

A

Better decisions should follow from a more accurate and realistic assessment of revenues and costs

How well did you know this?
1
Not at all
2
3
4
5
Perfectly
5
Q

Advantages of life cycle costing (longer-term thinking)

A

It encourages longer-term thinking and forward-planning and may provide more useful information that traditional reports of historical costs and profits for each accounting period

How well did you know this?
1
Not at all
2
3
4
5
Perfectly