ITPEC IP April 2024 Question 15
ITPEC IP April 2024 — Question 15 of 100
TCO for the sales management system includes both its software maintenance cost and hardware maintenance cost, items (iii) and (iv). Total Cost of Ownership measures the lifecycle cost of acquiring, operating, supporting, maintaining, and eventually replacing or disposing of an information system. It includes direct and indirect IT costs beyond the initial purchase price.
The purchase price and shipment cost of products sold through the system are costs of the merchandise and sales operation, not costs of owning the sales management system itself.
Answer (d)
Why not others:
- (a) contains only product-related business costs
- (b) mixes a product purchase cost with one valid system maintenance cost
- (c) mixes a product shipment cost with one valid system maintenance cost
Key rule: Define the asset whose TCO is being measured, then include all lifecycle costs attributable to owning and operating that asset, not costs of the business transactions it processes.
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