Very understandable lectures. Got 100%.Thankyou for your service. It really means a lot for many of us as you offer everything for free
C
chukwudi·
I am not sure as to why distribution cost is part of the life cycle cost
K
karthikeyan·
it is included since it is cost estimated to be incurred for that product. in life cycle cost you have take every cost incurred and incurable for that product.
A
Aasif·
Great Lectures Sir.. Thank you
Just one clarification, does the life cycle cost also cover administration and finance cost, if any as well?
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khadar abdikarim·
got one question why are distribution costs included in calculating lifecycle accounting
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Usman·
Hello John, I appreciate the good work u are doing.
A
Abubukr·
Not too sure about LCC is just concerned about profit rather than the costing phase.?
A
Abubukr·
I think the answer to question one is wrong! it says it ensures to generate profit over the entire lifecycle of a product which is wrong! as most products can't generate profit in the development phase.
J
John MoffatTutor·
No (it is an actual past exam question). By a profit over the entire life it is meaning over the whole life in total, not at each stage throughout its life.
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Isaiah·
Good lecture, got a 100% on this 1. Thanks
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Crimsimon·
Thanks, for the clear and precise lecture I got 100%.
J
John MoffatTutor·
Great :-)
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Natalie·
I am able to get 100%, pretty good revision for lecture.
Sir, really appreciate your clear and informative presentation on each lecture.
J
John MoffatTutor·
Thank you for your comment.
M
marah7·
Thank you for the questions . I got 100%
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PAUL·
Too tricky but 66% is not bad. i was of the view that you keep on providing numerous test questions other than one. Thank you
J
John MoffatTutor·
No - we only have these short tests. It is essential that you buy a Revision Kit from one of the ACCA Approved Publishers because it is full of past exam and other exam standard questions for practice, and practice is vital to passing the exam.
D
Dany Harris·
Hello! Nice questions! But can you explain the first question? In life cycle costing, the profit doesnt occur until after design and development stage and introduction stage.
Or is the statement talking about the generality that the business comes to know for sure if it will generate profits by selling that product in the future?
Thank you! Just putting it on the record, your responses so far to all my questions in the forum have always helped me :-)
J
John MoffatTutor·
It takes account of all of the costs (including design and development). The idea is to ensure that the product makes an overall total profit over its entire life (even though in the early years it is likely to be loss-making).
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Chaminda·
Thank you sir. I think, I should more focus on correct steps on theory.
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neoh·
nice quiz?thank you very much and I able to score 100%?
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Blessed·
interesting
T
tanatswajc·
nice set of questions
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kissme4560·
Nice questions but very tricky but I was able to score 100%
K
kissazehra·
My question is that we don't make profit for the entire life of product.there are some loss making stages like designing stage and somehow introducing stage of product .can you please explain me the first question of this test
J
John MoffatTutor·
What is means is that the aim is make a total overall profit (the total of all the years), which is true (even though some individual seats may be loss-making).
I can understand you finding the wording a bit confusing, but the wording is correct (and the same wording could be used in the exam).
R
Ritu·
Could you please explain the 1st question ..
We take into consideration all the cost but why is there exception to design and development cost .
R
Ritu·
I understood the point..
?
J
John MoffatTutor·
I am pleased that you understand :-)
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sdehnjo·
100% first attempt
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MMA·
100%
J
John MoffatTutor·
Very good :-)
But do make sure that you buy a Revision Kit from one of the ACCA approved publishers. Our tests are just meant to be quick checks, but the Revision Kit is full of past exam and other exam-standard questions in the various question formats. Practice at all the questions is essential to passing the exam.
A
Andy·
100% ...:)
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Malaika·
My first 100% :) :) out of chapters 1-3 *dances*
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Urmil·
100% result , thank you john
J
John MoffatTutor·
Great :-)
M
maganok·
Scored lowest on this quiz,had to go back to the lecture videos.
It makes sense now.Thank you.
J
John MoffatTutor·
You are welcome :-)
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Naomi·
Hello
I got question 1 wrong, does it mean that profit is generated throughout the product life cycle even though it is negative profit ie loss which is in the stages from development to growth
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John MoffatTutor·
No - it means that overall there is a profit (there is likely to be a loss in some years, but a profit in other years - the intention is that over the whole life an overall profit will result).
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Naomi·
thank you
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John MoffatTutor·
You are welcome :-)
M
Mohamed·
How is statement 1 correct you dont make a profit in the stage of design and and introductory can you explain
J
John MoffatTutor·
But I explain this in the free lecture - did you not watch the lecture before attempting the test?
Initially you have few sales and a lot of expenses - so you are likely to make a loss.
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zulfugar·
Dear tutor,
Firstly, thank you very much for taking time to create such a great lecture series and share it for free with all of us!
Secondly, I would like to point out something that I don't quite agree with in regards to the semantics of the first question. Although, I understand that BEFORE any costs are incurred in regards to a product, ALL of the lifecycle costs should be taken into consideration. But the way the second statement is constructed, "costs ALREADY spent on the design and development" implies D&D costs are already IRRELEVANT (i.e. they are sunk costs) for decision making. Hence, one would argue that if a company is to do a Lifecycle Costing analysis AFTER the costs are already incurred (which is the case with the second statement) then the second statement should be considered correct.
Thank you and best regards!
J
John MoffatTutor·
I understand your point, but life-cycle costing is different from relevant costing in that it attempts to find the cost over the entire life of the product and includes all costs (as a basis for a decision on what selling price to charge).
(This was an actual past exam question)
M
Mpereira·
Dear sir,
I am wondering why we should take the design and development cost in consideration to calculate the life cycle cost per unit in this question. Design and development costs should not be exception, because the product is not generating revenue yet as it was told in the question 2?
Thank you very much
J
John MoffatTutor·
We are after calculating the total cost and we include all costs involved, regardless of when it starts generating revenue.
(This is nothing to do with how costs would be reported in financial accounts - this is in order to help determine the selling price needed to make the product worthwhile.)
S
shibl·
Great!!!!!
I know my comment is irrelevant here but I don't know how to express my feelings and where to and how to show you my heartfelt thanks.
I will InshaAllah (by the will of God) donate to your cause.
God be with you!!!
keep up the good work
J
John MoffatTutor·
Thank you very much for your comment :-)
P
prati·
The first question, I don't quite agree with statement two being incorrect. Lifecycle costing do take all cost over a product lifecycle including of the design and development cost. And more importantly why the costs are taken for a product over its entire lifecycle is because most of a product cost are incurred in the design and development stage where the product have not reach the market as yet but have started to incur cost. At least that's what the Text book says. Please let me know if there's a reasonable explanation for the exception of design and development cost on a product life cycle
P
prati·
Hello please disregard my comment above. I realize my error. Sorry about that :)
J
John MoffatTutor·
No problem :-)
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Gem·
Sir,
Why did we use the manaufacturing cost to calculate the cost per unit in Example 1 in the lecture but used the total cost to calculate life cycle costing for practice question #3?
Kindly clarify, please
J
John MoffatTutor·
But in the lecture we also use total costs - that is the whole point of lifecycle costing!
(The manufacturing cost in the lecture is $6 per unit, but the lifecycle cost is $7.80 per unit).
G
Gem·
Thanks for your response. I agree we used total costs for both questions however I was wondering whether there was a particular reason why the calculation of the cost per unit used use manufacturing costs ($240,000 lecture) as opposed to total costs (160000 practice quest
J
John MoffatTutor·
But there is no 240,000 in the lecture! The manufacturing costs are 50,000 units at $6 per unit, and to this is added the design and development and the end of life costs.
G
ganeshkrupad·
Good practice question. Thank you.
J
John MoffatTutor·
You are welcome :-)
M
msipad·
good questions, hope all will be this nice in exams
J
John MoffatTutor·
Do make sure that you also have a Revision Kit from one of the ACCA approved publishers - it is vital to practice lots and lots of questions.
A
Ansu Koroma·
Thanks for the practice questions. Students should note that life-cycle costing tracks and accumulates costs and revenues associated with a product over its entire life-cycle.
J
John MoffatTutor·
Which is covered in our free lectures :-)
H
HUYEN·
Pls explain the question 1, Why is Statement 1 true? Because I think in development phase it doesn't make any profit? Am I right?
Thank you very much,
J
John MoffatTutor·
Statement 1 is not saying that there will be a profit in each individual year - there quite likely will not be.
It is saying that we ensuring a profit over the entire life. i.e. that over the whole life it does make a total overall profit.
G
Gary·
Lifecycle costing question regarding if it takes account of all costs over the life of the product, I think the selection is wrong. A site/software issue. Just a heads up.
J
John MoffatTutor·
The answer given in the test is correct - it is not a site/software issue.
Statement 2 is not correct - lifecycle costing takes into account all costs and does not exempt certain costs.
G
Gary·
Apologies John. My mistake.
J
John MoffatTutor·
No problem :-)
O
oluwanisola·
i was a bit scared, thought i was mistaken when i didnt see the costs just now till i read the comment.
J
John MoffatTutor·
Sorry :-(
F
Fidelka·
There are no lifetime costs on the screen. All three: Design and Development, Manufacturing and End of life costs are shown without $ amounts???
J
John MoffatTutor·
Oops!
Thank you for letting me know. I will have it corrected :-)
Just one clarification, does the life cycle cost also cover administration and finance cost, if any as well?
Sir, really appreciate your clear and informative presentation on each lecture.
Or is the statement talking about the generality that the business comes to know for sure if it will generate profits by selling that product in the future?
Thank you! Just putting it on the record, your responses so far to all my questions in the forum have always helped me :-)
I can understand you finding the wording a bit confusing, but the wording is correct (and the same wording could be used in the exam).
We take into consideration all the cost but why is there exception to design and development cost .
?
But do make sure that you buy a Revision Kit from one of the ACCA approved publishers. Our tests are just meant to be quick checks, but the Revision Kit is full of past exam and other exam-standard questions in the various question formats. Practice at all the questions is essential to passing the exam.
It makes sense now.Thank you.
I got question 1 wrong, does it mean that profit is generated throughout the product life cycle even though it is negative profit ie loss which is in the stages from development to growth
Initially you have few sales and a lot of expenses - so you are likely to make a loss.
Firstly, thank you very much for taking time to create such a great lecture series and share it for free with all of us!
Secondly, I would like to point out something that I don't quite agree with in regards to the semantics of the first question. Although, I understand that BEFORE any costs are incurred in regards to a product, ALL of the lifecycle costs should be taken into consideration. But the way the second statement is constructed, "costs ALREADY spent on the design and development" implies D&D costs are already IRRELEVANT (i.e. they are sunk costs) for decision making. Hence, one would argue that if a company is to do a Lifecycle Costing analysis AFTER the costs are already incurred (which is the case with the second statement) then the second statement should be considered correct.
Thank you and best regards!
(This was an actual past exam question)
I am wondering why we should take the design and development cost in consideration to calculate the life cycle cost per unit in this question. Design and development costs should not be exception, because the product is not generating revenue yet as it was told in the question 2?
Thank you very much
(This is nothing to do with how costs would be reported in financial accounts - this is in order to help determine the selling price needed to make the product worthwhile.)
I know my comment is irrelevant here but I don't know how to express my feelings and where to and how to show you my heartfelt thanks.
I will InshaAllah (by the will of God) donate to your cause.
God be with you!!!
keep up the good work
Why did we use the manaufacturing cost to calculate the cost per unit in Example 1 in the lecture but used the total cost to calculate life cycle costing for practice question #3?
Kindly clarify, please
(The manufacturing cost in the lecture is $6 per unit, but the lifecycle cost is $7.80 per unit).
Thank you very much,
It is saying that we ensuring a profit over the entire life. i.e. that over the whole life it does make a total overall profit.
Statement 2 is not correct - lifecycle costing takes into account all costs and does not exempt certain costs.
Thank you for letting me know. I will have it corrected :-)