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    Assignment 2 PDF

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    AL habesha
    This document contains three construction equipment assignment problems. The first problem involves a machine that cost $245,000 to purchase with operating costs of $47.64 per hour and tire replacement costs of $13,700 every 3,100 hours. It is expected to last 9,300 hours and be sold for 17% of the original price. The second problem involves a $45,000 machine with $12.34 per hour operating costs and $3,200 tire replacements every 2,800 hours. It will require $6,000 in repairs after 4,200 hours and last 8,400 hours being sold for 10% of the original price. The third problem involves a $300,000 loader

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    Assignment 2 PDF

    Uploaded by

    AL habesha
    175 views1 page
    This document contains three construction equipment assignment problems. The first problem involves a machine that cost $245,000 to purchase with operating costs of $47.64 per hour and tire replacement costs of $13,700 every 3,100 hours. It is expected to last 9,300 hours and be sold for 17% of the original price. The second problem involves a $45,000 machine with $12.34 per hour operating costs and $3,200 tire replacements every 2,800 hours. It will require $6,000 in repairs after 4,200 hours and last 8,400 hours being sold for 10% of the original price. The third problem involves a $300,000 loader

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    This document contains three construction equipment assignment problems. The first problem involves a machine that cost $245,000 to purchase with operating costs of $47.64 per hour and tire replacement costs of $13,700 every 3,100 hours. It is expected to last 9,300 hours and be sold for 17% of the original price. The second problem involves a $45,000 machine with $12.34 per hour operating costs and $3,200 tire replacements every 2,800 hours. It will require $6,000 in repairs after 4,200 hours and last 8,400 hours being sold for 10% of the original price. The third problem involves a $300,000 loader

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    175 views1 page

    Assignment 2 PDF

    Uploaded by

    AL habesha
    This document contains three construction equipment assignment problems. The first problem involves a machine that cost $245,000 to purchase with operating costs of $47.64 per hour and tire replacement costs of $13,700 every 3,100 hours. It is expected to last 9,300 hours and be sold for 17% of the original price. The second problem involves a $45,000 machine with $12.34 per hour operating costs and $3,200 tire replacements every 2,800 hours. It will require $6,000 in repairs after 4,200 hours and last 8,400 hours being sold for 10% of the original price. The third problem involves a $300,000 loader

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    of 1

    Construction Equipment and Methods Assignment 2

    1. A machine cost $245,000 to purchase fuel, oil, grease and minor maintenance
    are estimated to cost $47.64 per operating hour. A set of tires cost $ 13,700 to
    replace, and their estimated life is 3,100 use hours. A $15,000 major repair
    will probably be required after 6,200hr of use. The machine is expected to last
    for 9,300hr, after which it will be sold at a price (salvage value) equal to 17%
    of the original purchase price. A final set of new tires will not be purchased
    before the sale. How much should the owner of the machine charge per hour
    of use, if it is expected that the machine will operate 3,100hr per year? The
    company’s cost of capital rate is 8%.
    2. A machine cost $45,000 to purchase. Fuel, oil, grease (FOG), and minor
    maintenance are estimated to cost $12.34 per operating hour (those hours
    when the engine is operating and the machine is doing work). A set of tires
    cost $3,200 to replace, and their estimated life is 2,800 use hours. A $6,000
    major repair will probably be required after 4,200hr of use. The machine is
    expected to last for 8,400hr, after which it will be sold at a price (salvage
    value) equal to 10% of the original purchase price. A final set of new tires will
    not be purchased before the sale. How much should the owner of the machine
    charge per hour of use, if it is expected that the machine will operate 1,400hr
    per year? The company's cost of capital rate is 7%. First solve for n, the life
    3. A company having a cost of capital rate of 8% purchases a $ 300,000 loader.
    This machine has an expected service life of 4yr and will be utilized 2,500hr
    per year. The tires on this machine cost $45,000. The estimated salvage value
    at the end of 4yr is $50,000. Calculate the depreciation portion of the
    ownership cost for this machine using the time value method.

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