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Chapter 4-Estimating-Worked Examples.1 (B) - Q+ans - Unit Rate - Plant (Excavator)

The document calculates the all-in hourly cost for a Komatsu hydraulic excavator. It determines the standing charge by calculating the capital cost, residual value, depreciation, interest, maintenance costs, insurance, and road tax over the expected 10 year life. It then calculates the running charge based on operator wages, fuel costs, and lubricants. Adding a 15% overhead and profit to both the standing and running charges, it determines the total hourly cost is RM106.36.

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Omar Hassouna
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119 views2 pages

Chapter 4-Estimating-Worked Examples.1 (B) - Q+ans - Unit Rate - Plant (Excavator)

The document calculates the all-in hourly cost for a Komatsu hydraulic excavator. It determines the standing charge by calculating the capital cost, residual value, depreciation, interest, maintenance costs, insurance, and road tax over the expected 10 year life. It then calculates the running charge based on operator wages, fuel costs, and lubricants. Adding a 15% overhead and profit to both the standing and running charges, it determines the total hourly cost is RM106.36.

Uploaded by

Omar Hassouna
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

Q1(b) Based on the following information given, calculate the “all- in”(Gross Rate) hourly cost for a

Komatsu hydraulic excavator. Adopt 15% as overhead and profit for both
standing and running charge.

Capital cost (purchase price) RM 400,000


Residual Value (resale/scrap value) RM 80,000
Interest on capital 4.3% compounded annually
Expected Life 10 years
Hours worked per annum 3000
Maintenance costs 6% of capital cost per annum
Insurance RM3,000 per annum
Road Tax RM 1000 per annum
Operator’s rate RM 16 per hour
Fuel 18 litres/ hour @RM 2.50/litre
Lubricants allow 10% of fuel costs

Solution:
Standing Charge
Capital Cost RM 400,000.00

Less Residual Value RM 80,000.00 -


Depreciation RM 320,000.00
Interest on capital, 4.3% compound over 10 years
= 400,000 [(1 + 0.043)¹º − 1] RM 209,400.88
Maintenance costs
= 400,000×0.06×10 RM 240,000.00
Insurance @RM3000/yearx10 yrs RM 30,000.00
Road Tax @RM1000/yearx10 yrs RM 10,000.00 +
Total for 10 years RM 809,400.88

Hourly rate of standing charge


= 809,400.88 ÷ (10×3000) RM 26.98/hour
Allow 15% for overhead and profit
= 26.98×0.15 RM 4.05/hour +
Total standing charge
Running Charge
Operator wages /hour RM 16.00
Fuel /hour
= 18×2.5 RM 45.00
Lubricants 10% of fuel costs RM 4.50
Hourly rate of running charge
= 16 + 45 + 4.5 RM 65.50/hour

Allow 15% for overhead and profit


= 65.50×0.15 RM 9.83/hour
Total running charge RM 75.33/hour

Total Cost
Standing charge RM 31.03/hour
Running charge RM 75.33/hour
Total hourly cost RM 106.36/hour

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