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Lifecycle period cost

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Lifecycle period cost

  • This topic has 1 reply, 2 voices, and was last updated 8 months ago by John Moffat.
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  • October 5, 2021 at 2:48 pm #637027
    Joseph.Andrews
    • Topics: 45
    • Replies: 23
    • ☆☆

    We only include costs related to a life of a product in lifecycle costing. Any other cost relating to any other period would be irrelevant?

    For example:
    If we produce a product that has a life of 5 years so every cost relating to those 5 years would be relevant for lifecycle costing BUT if we are given other costs relating to any other period which is more than 5 years then we would not be including that cost in the calculation?

    October 5, 2021 at 4:02 pm #637039
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 49603
    • ☆☆☆☆☆

    We include all costs over the life of the product. The only example I can think of as to why there should be any costs after the five years is that maybe in the 6th year there are costs of dismantling the machinery involved. If that was the case then these would be included as well.

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