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Could someone please explain from the scratch what life cycle costing is. I do not remember doing it in lower papers either.
Thank you
Life cycle costings tracks and accumulates costs and revenues over the entire life of a product, which means that a product’s total profitability can be determined.
A product’s life cycle is in 4 stages:
1) Reserch and development of the product- high costs accumulated here and no revenue at all
2)Introduction stage still more costs
3)Mature stage less costs but more revenus- alot of cash cows here
4)Decline stage- less revenue and less cost as the product will be out of fashion.i hope this will help you.
Good Luck!
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