• Skip to primary navigation
  • Skip to main content
  • Skip to primary sidebar
Free ACCA & CIMA online courses from OpenTuition

Free ACCA & CIMA online courses from OpenTuition

Free Notes, Lectures, Tests and Forums for ACCA and CIMA exams

  • ACCA
  • CIMA
  • FIA
  • OBU
  • Books
  • Forums
  • Ask AI
  • Search
  • Register
  • Login
  • ACCA Forums
  • Ask ACCA Tutor
  • CIMA Forums
  • Ask CIMA Tutor
  • FIA
  • OBU
  • Buy/Sell Books
  • All Forums
  • Latest Topics

20% off ACCA & CIMA Books

OpenTuition recommends the new interactive BPP books for March and June 2025 exams.
Get your discount code >>

Life cycle costing

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Life cycle costing

  • This topic has 5 replies, 2 voices, and was last updated 4 years ago by John Moffat.
Viewing 6 posts - 1 through 6 (of 6 total)
  • Author
    Posts
  • February 9, 2021 at 7:28 pm #609863
    kennigara
    Participant
    • Topics: 193
    • Replies: 250
    • ☆☆☆

    Hi dear Tutor I took all of the following questions from Kaplan

    Question first

    Which of the following are said to be benefits of life cycle costing?

    1) It provides the true financial cost of a product
    2) The length of the lifecycle can be shortened
    3) Expensive errors can be avoided in that potentially failing products can be avoided
    4) Lower costs can be achieved earlier by designing out costs
    5) Better selling price can be set
    6) Decline stages of the lifecycle can be avoided

    I selected here 1,2.3.4.5 but in the answer shows 1,3,4, and why not 2-“shortening the length of a lifecycle is not desirable and decline (for most products) inevitable”

    Second question
    The following statements relate to the justification of the use of life cycle costing:

    1)Product life cycles are becoming increasingly short.This means that the iniitial costs are an increasingly important component in the product’s overall costs

    2)Product costs are increasingly weiighted to the start of a product’s life cycle, and to properly understand the profitability of a product these costs must be matched to the ultimate revenues

    3)The high costs of (for example) research, design and marketing in the early stages in a product’s life cycle necessitate a high initial selling price

    4)Traditional capital budgeting techniques do not attempt to minimise the costs or maximise the revenues over the product life cycle

    here i selected 1,3 and 4 which is correct

    my question here is that if we compare two questions i see contradictory opinion between

    2) The length of the lifecycle can be shortened which can not be considered benefit and 1)Product life cycles are becoming increasingly short.This means that the iniitial costs are an increasingly important component in the product’s overall costs-it has been given right option

    February 10, 2021 at 9:35 am #609892
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54659
    • ☆☆☆☆☆

    Shortening the life cycle may well be a good idea, but using life-cycle costing does not mean that we can automatically shorten the life-cycle – maybe we can, maybe we can’t. We will consider it, but that doesn’t mean we can shorten it.

    February 10, 2021 at 10:30 am #609902
    kennigara
    Participant
    • Topics: 193
    • Replies: 250
    • ☆☆☆

    from benefit point of view it is not but from using point of view we can or can not

    February 10, 2021 at 10:53 am #609911
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54659
    • ☆☆☆☆☆

    It may be something we decide to do, but it is not an automatic benefit of using life-cycle costing.

    February 10, 2021 at 2:23 pm #609928
    kennigara
    Participant
    • Topics: 193
    • Replies: 250
    • ☆☆☆

    Understood.Dear Tutor I will come to relevant cost example either.

    February 10, 2021 at 2:44 pm #609936
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54659
    • ☆☆☆☆☆

    You are welcome 🙂

  • Author
    Posts
Viewing 6 posts - 1 through 6 (of 6 total)
  • The topic ‘Life cycle costing’ is closed to new replies.

Primary Sidebar

Donate
If you have benefited from our materials, please donate

ACCA News:

ACCA My Exam Performance for non-variant

Applied Skills exams is available NOW

ACCA Options:  “Read the Mind of the Marker” articles

Subscribe to ACCA’s Student Accountant Direct

ACCA CBE 2025 Exams

How was your exam, and what was the exam result?

BT CBE exam was.. | MA CBE exam was..
FA CBE exam was.. | LW CBE exam was..

Donate

If you have benefited from OpenTuition please donate.

PQ Magazine

Latest Comments

  • Kakui on Equity Law, Ratio Decidendi – ACCA LW Global
  • Nicholas1239798 on IASB Conceptual Framework – Introduction – ACCA Financial Reporting (FR)
  • Starmoon123 on Strategy formulation (Part 2) – ACCA (AFM) lectures
  • nosiphoceliwedlamini@gmail.com on Revenue – Example 5 (profitable contracts) – ACCA Financial Reporting (FR)
  • amaanalli on Fraud, bribery, whistle-blowing and company ethics – ACCA Strategic Business Leader (SBL)

Copyright © 2025 · Support · Contact · Advertising · OpenLicense · About · Sitemap · Comments · Log in