When using life-cycle costing as one of the criteria for evaluating and selecting a supplier for a new oil well drilling platform,a purchasing agent should look at:
A) the initial cost of the platform.
B) the estimated maintenance cost for the platform over a ten-year period.
C) how soon the platform will need to be replaced.
D) the cost of installing the platform at a drilling site.
E) all of the above

Question

Quizplus · Accepted Answer

When using life-cycle costing, it is important to consider the initial cost of the platform (A), the estimated maintenance cost over a ten-year period (B), and how soon the platform will need to be replaced (C). It is also important to consider the cost of installing the platform at a drilling site (D). Therefore, all of the above options (E) should be considered when evaluating and selecting a supplier for a new oil well drilling platform.

When Using Life-Cycle Costing as One of the Criteria for Evaluating