Practice Significance Of Estimation Of Cost Of Equipment (3.1) - Construction Methods and Equipment Management

Practice: Significance of Estimation of Cost of Equipment

Lesson 3.1Construction Methods and Equipment Management

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8 questions

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6 sample questions

Question 1.
What are the two main components of equipment costs?
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Think about costs incurred with and without usage.
Question 2.
What does depreciation refer to?
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Consider how equipment changes from purchase to sale.
3Question 3.
What is the main purpose of equipment cost estimation?
- To improve communication
- To ensure profitability
- To increase project duration
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Consider what can happen if costs are underestimated.
4Question 4.
True or False: Operating costs only occur when the equipment is idle.
- True
- False
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Think about when you incur costs for operating machinery.
Question 5.
A construction equipment has an initial cost of $100,000, expected to be used for 10 years. The salvage value is estimated at $10,000. Calculate the annual depreciation using the straight-line method.
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Use the formula for straight-line depreciation.
Question 6.
If a project's total ownership cost is $50,000 and it must cover both ownership and operating costs which are 60% ownership and 40% operating, how much can be allocated to operating costs?
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Calculate percentage of total costs for allocation.

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