The approach to cost management that calls for setting cost reduction goals across numerous stages such as product introduction, growth, maturity, and decline is:
A) Life cycle cost management.
B) Total quality management.
C) Target costing.
D) Just-in-time inventory.

Question

Quizplus · Accepted Answer

The approach described in the question, which involves setting cost reduction goals across different stages of a product's life cycle, is known as life cycle cost management. This approach recognizes that costs and cost structures can change as a product moves through these different stages, and aims to manage costs accordingly. Total quality management focuses on improving quality and reducing defects, rather than specifically managing costs. Target costing is a process of setting a target cost for a product and then designing the product and its production process to meet that cost target. Just-in-time inventory is a method of inventory management that involves receiving and using inventory only when it is needed, which can help reduce costs associated with holding inventory. However, none of these approaches specifically involve setting cost reduction goals across different product life cycle stages.

The Approach to Cost Management That Calls for Setting Cost