US CMA Part 1 · Chapter 4 · Question 22 of 22
Which statement best describes life-cycle costing?
Test yourself: pick an answer
Reveal answer & explanation
Correct answer: A) It accumulates all costs of a product from research and design through production, marketing and after-sale support
Explanation
Life-cycle costing tracks costs over the whole life of a product, including upstream costs (research, design) and downstream costs (marketing, distribution, customer service). Because many costs are committed at the design stage, it helps managers focus cost reduction early.
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