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الموضوع: Pricing Equipment Example

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    Pricing Equipment Example

    Given:
    • Skid-steer loader cost to purchase = $45,000
    • Fuel, oil, and minor maintenance cost $12.34/hour of operation
    • Cost to replace tires = $3,200
    • Need to replace tires after every 2,800 hours of use
    • Major repairs of $6,000 are expected after 4,200 hours of use
    • Equipment expected to last 8,400 hours
    • Salvage value at the end-of-life is 10% of the purchase price
    • Equipment use expected to be 1,400 hours per year
    • Interest rate of 15%
    Find:
    How much should the owner of the skid-steer loader charge per hour of use?
    Solution:
    Ask students which method should be used to solve.
    Either Present Worth (PW) or Annual Worth (AW) will work but PW will have to be calculated to AW to get hourly cost.
    AW/1400 hours = $ charged/hour


    Both solutions are attached.
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