Filhaal Electronics LLC also plans to introduce a new model of mobile phone in the market. The expected life cycle of the product is three years. The company has been

Filhaal Electronics LLC also plans to introduce a new model of mobile phone in the market. The expected life cycle of the product is three years. The company has been adopting the traditional method of costing. Imagine you are the management accountant of the company and you suggest the management to adopt Life Cycle Costing for the mobile phone instead of traditional method of costing. You have the following information at your disposal: Mobile phone year 1 year 2 year 3 Research and development 1200 Production cost per unit 110 190 175 Customer service cost per unit 32 29 28 Advertising and sales promotion cost 25 28 14 Retirement and disposal cost 250 Units produced and sold 200 400 700 The Life Cycle Cost per unit will be: a. RO 227.308 b. RO 218.461 c. RO 219.654 d. RO 227.305

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