Life-Cycle Costing; Service Department In the chapter, we illustrated the use of the life-cycleconcept for both the cost and sales life cycles of a company’s product lines. It can also be usefulto extend the cost life cycle to the service department. In Chapter 7, we were interested in theallocation of service department costs to product lines. Here we are interested in managing the costsof a service department over its life cycle. The information technology department (IT) is a goodexample. The costs incurred in IT have the following phases:1. Acquire IT assets, including computers, hubs, cables, and other assets.2. Acquire software and deploy IT for the desired application and functionality.3. Maintain management and operations of the IT assets.4. Provide user support.5. Retire the assets on a planned schedule and replace as needed.Required How can life-cycle costing help in the management of the IT department?
Life-Cycle Costing; Service Department In the chapter, we illustrated the use of the life-cycle
concept for both the cost and sales life cycles of a company’s product lines. It can also be useful
to extend the cost life cycle to the service department. In Chapter 7, we were interested in the
allocation of service department costs to product lines. Here we are interested in managing the costs
of a service department over its life cycle. The information technology department (IT) is a good
example. The costs incurred in IT have the following phases:
1. Acquire IT assets, including computers, hubs, cables, and other assets.
2. Acquire software and deploy IT for the desired application and functionality.
3. Maintain management and operations of the IT assets.
4. Provide user support.
5. Retire the assets on a planned schedule and replace as needed.
Required How can life-cycle costing help in the management of the IT department?
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