The process of attempting to determine all cost elements such as acquisition price,purchasing administration,follow-up,expediting,inspection and testing,rework,scrap,downtime,lost sales and customer returns is called:
A)activity-based costing.
B)total cost of ownership.
C)target costing.
D)competitive bidding.
E)learning curve.

Question

Quizplus · Accepted Answer

The process of attempting to determine all cost elements such as acquisition price, purchasing administration, follow-up, expediting, inspection and testing, rework, scrap, downtime, lost sales and customer returns is called total cost of ownership (TCO). TCO represents the total cost of a product or service over its lifetime, from development to disposal. TCO helps to make better decisions about purchasing and sourcing by considering all the costs associated with a product or service, not just its initial purchase price.

The Process of Attempting to Determine All Cost Elements Such