1. Given the following conditions, calculate both the hourly ownership and operating costs: • A $900,000 single-engine scraper will be used 2,000 hours per year under average operating conditions. Tires for the scraper cost $100,000 and they last for 4,000 hours. The scraper will reach the end of its useful life with $150,000 salvage value. Interest (4%), taxes (3%), insurance (2%), and storage (1%). The flywheel horsepower of the scraper diesel engine is 500 HP. Diesel fuel costs $4.0/gallon. Operator wage is $50/hr including fringe benefits.

A machine cost $450,000 to purchase. Fuel, oil, grease, and minor maintenance areestimated to cost $55.00 per operating hour. A set of tires cost $18,000 to replace, and theirestimated life is 3,100 use hours. A $27,000 major repair will probably be required after6,200 hr of use. The machine is expected to last for 9,300 hr, after which it will be sold at aprice (salvage value) equal to 20% of the original purchase price. A final set of new tireswill not be purchased before the sale. How much should the owner of the machine chargeper hour of use, if it is expected that the machine will operate 3,100 hr per year? Thecompany’s cost of capital (interest) rate is 8.3%.

2. Calculate the ownership cost per hour for a dump truck powered by a 120-hp gasoline engine based on the following data:        purchase price=175,000 birr        Freight charges=2,000 birr        Estimated salvage value=57,500 birr        Operation salvage value=40%        Useful life=5 yerars        Hours used per year=1800        Maintenance and repair=130% of annual depreciation        Tire cost= 5,000 birr        Tire life= 4,000 hours         Mainteenance and repairs (tires) =15% of tire depreciation        Gaseoline fuel price =4.0 birr/ gallon        Fuel consumption = 0.06 gallon/hp/hr        Lube oil cost= 10% of fule       Interest rate (/) = 10%

What is the hourly rate of equipment based on the following data? Purchase price (P) = $460,000 %3D Salvage value (F) = $40,000 Useful life (N) = 10 years Working hours per year = 2000 Hours Annual maintenance costs = 10% of purchase price Annual operating costs = $47,000 %3D Interest rate (i) = 15% Select one: a. $61.34/hr b. $51.34/hr c. $91.34/hr d. $81.34/hr

A new chemical remediation tank is needed. Current technology tanks, which cost $150,000, must be drained and treated every 2 years at a cost of $30,000; the tanks will last 10 years, and each will have a salvage value of 5% of first cost. A tank with new technology has just come on the market. There are no periodic maintenance costs, and a tank will last 20 years. If the new tanks cost $325,000, what minimum salvage value, as a percentage of first cost, would be required for this technology to be a better option? Use a 12% interest rate. (a) 10% (b) 36% (c) 57% (d) 72%?

5.26 An industrial engineer is considering two robots for purchase by a fiber-optic manufacturing com- pany. Robot X will have a first cost of $80,000, an annual maintenance and operation (M&O) cost of S30,000, and a $40,000 salvage value. Robot Y will have a first cost of $97,000, an annual M&O cost of $27,000, and a $50,000 salvage value. Which should be selected on the basis of a future worth comparison at an interest rate of 15% per year? Use a 3-year study period.

A certain machine cost P43,013 and has a life of 10 years and salvage value of P5,623. The production outputs and the working hours of this machine per year are as follows: 1st year are 1,754 units and 12,461 hours; 2nd year are 2,203 units and 15,913 hours; 3rd year are 3,151 units and 19,632 hours and 4th year are 3,681 units and 21,946 hours. The capacity of the machine is 50,000 units and 200,000 hours. Assume that the units produced are of uniform quality. Determine the following: a. Depreciation charged on the 2nd year using both SOM and WHM. b. Book value after 4 years using SOM. c. Book value after 3 years using WHM.

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Q1. Calculate the expected hourly owning and operating cost for the second year of operation of the twin-engine scraper described below: Cost delivered 300,000 JD Tire cost = 24,000 JD Estimated life= 5 years Salvage value = 30,000 JD Depreciation method=sum-of-the-years digits Investment (interest) rate = 10% Hours used per year = 2,000 hr Tax, insurance, and storage rate = 8% Rated power = 465 hp Fuel price=0.40JD/ liter Operator's wages = 6 JD/h Fuel consumption factor = 0.035 liter /h/hp Service cost factor = 33% of hourly fuel cost Equipment Repair cost = 8.4 JD/h Estimated tire life= 3,000 hr

A mixer cost P30,000. Maintenance cost is P3,000, every two years. The device will generate revenues of 10,000, each year for 6 years after which the salvage value is expected to P5,000.make a cash-flow diagram of a mixer in 6 years period be