ExpertACCA · Question 19 · Lifecycle Costing
Section B - Case 1: AeroYield
AeroYield is a technology startup developing specialized drones for the agriculture sector to monitor crop health. The company is preparing to launch its new model, the 'AgriScout'. Market research indicates that customers are willing to pay $8,000 for the AgriScout. AeroYield's investors require a profit margin of 25% on the selling price.
The current estimated production cost for the AgriScout is $6,400 per unit.
AeroYield is also considering the lifecycle costs of the AgriScout. Over its 3-year life, total R&D costs will be $500,000, total marketing costs $200,000, and end-of-life disposal costs $50,000. Total production volume is expected to be 1,000 units. The variable production cost is $6,400 per unit.
What is the lifecycle cost per unit of the AgriScout?
Section B - Case 1: AeroYield
AeroYield is a technology startup developing specialized drones for the agriculture sector to monitor crop health. The company is preparing to launch its new model, the 'AgriScout'. Market research indicates that customers are willing to pay $8,000 for the AgriScout. AeroYield's investors require a profit margin of 25% on the selling price.
The current estimated production cost for the AgriScout is $6,400 per unit.
AeroYield is also considering the lifecycle costs of the AgriScout. Over its 3-year life, total R&D costs will be $500,000, total marketing costs $200,000, and end-of-life disposal costs $50,000. Total production volume is expected to be 1,000 units. The variable production cost is $6,400 per unit.
What is the lifecycle cost per unit of the AgriScout?
Answer options:
$6,400
$6,900
$7,150
$7,500
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