Question: As explained in Chapter 13, the cost life cycle consists of the phases a product goes through within a firm to prepare the product for

As explained in Chapter 13, the cost life cycle consists of the phases a product goes through within a firm to prepare the product for and service. The five phases of the cost life cycle are: (a) research and development, (b) design, (c) production, (d) marketing and and (e) customer service. The early phases of the cost life cycle are particularly important in that a relatively high percentage (some say as high as 80 percent or more) of the product’s life-cycle costs are determined at these phases. That is, the downstream costs of manufacturing, service, and repair are a direct consequence of the quality of the design.

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At which phases of the cost life cycle, if any, should investment-center evaluation methods be used, and why?

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Investment centers are used throughout the product cost life cycle but especially in the later phases of the life cycle The early phases viz product r... View full answer

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