Question

The total cost analysis demonstrates how other costs besides the unit cost can affect purchase decisions. True False

Answer 1

Answer:

That statement is true

Explanation:

In order to conduct a total cost analysis, a company need to calculate every single relevant cost that occurs within  an operation  or project from start to finish. From this, the company usually can find out about hidden costs that might occurs outside the initial plan.

The decision makers can use this options to make their decision in the future. If the total hidden cost is larger than ideal, they can either implement a new budgeting plan or implement policies that minimize the hidden cost.