Construction Engineering & Management - Vol 1 | 5. Construction Methods and Equipment Management by Abraham | Learn Smarter
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Knowledge
5. Construction Methods and Equipment Management

The chapter focuses on the significance of estimating equipment costs, specifically ownership costs using the average annual investment method. It elaborates on components such as initial costs, depreciation, interest, taxes, insurance, and storage, emphasizing the importance of accurate estimations for effective equipment management. It also explores various depreciation accounting methods and their applications in estimating the depreciation of equipment over its useful life.

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Sections

  • 1

    Construction Methods And Equipment Management

    This section focuses on equipment cost estimation and ownership costs in construction management.

    Learning Practice

  • 2

    Equipment Cost - Ownership Cost (Average Annual Investment Method)

    This section outlines the ownership cost estimation of equipment using the average annual investment method, emphasizing the significance of cost estimation in construction project management.

    Learning Practice

  • 3

    Equipment Cost Estimation

    This section discusses the estimation of equipment costs, focusing on ownership and operating costs, including various depreciation methods.

    Learning Practice

  • 3.1

    Significance Of Estimation Of Cost Of Equipment

    This section emphasizes the critical importance of accurately estimating equipment costs for successful project bidding and profitability.

    Learning Practice

  • 3.2

    Components Of The Equipment Cost

    This section outlines the essential components of equipment cost, focusing on ownership and operating costs, and highlights the importance of accurate cost estimation for effective equipment management.

    Learning Practice

  • 3.2.1

    Ownership Cost

    This section covers the significance of ownership cost in equipment management, including its components and estimation methods.

    Learning Practice

  • 3.2.2

    Operating Cost

    This section provides insights into the significance of estimating equipment costs in construction management, focusing particularly on ownership and operating costs.

    Learning Practice

  • 4

    Components Of The Ownership Cost

    This section discusses the components of equipment ownership costs, essential for accurate cost estimation in construction management.

    Learning Practice

  • 4.1

    Initial Cost

    This section covers the estimation of equipment ownership costs, focusing on the significance of initial costs and various depreciation methods.

    Learning Practice

  • 4.2

    Depreciation

    This section discusses the importance of depreciation in equipment cost estimation, covering its impact on ownership costs and various methods of calculating depreciation.

    Learning Practice

  • 4.3

    Interest On Investment

    This section explores the importance of estimating equipment costs, particularly ownership costs, and various methods for determining depreciation.

    Learning Practice

  • 4.4

    Taxes

    This section discusses the significance of equipment cost estimation in construction, with a focus on ownership costs and their various components.

    Learning Practice

  • 4.5

    Insurance

    This section explains the importance and estimation methods of equipment ownership costs in construction management.

    Learning Practice

  • 4.6

    Storage

    This section discusses the significance and components of equipment cost estimation, particularly ownership costs and depreciation methods.

    Learning Practice

  • 5

    Depreciation Accounting Methods

    This section discusses various methods of calculating equipment depreciation, highlighting their significance in ownership cost estimation within the realms of construction methods and equipment management.

    Learning Practice

  • 5.1

    Straight Line Method

    This section discusses the Straight Line Method of depreciation used in equipment ownership cost estimation, highlighting its significance, calculation, and application.

    Learning Practice

  • 5.2

    Sum Of The Years Digit Method

    The Sum of the Years Digit Method is an accelerated depreciation technique used to estimate the depreciation of equipment over its useful life, allowing for higher depreciation expenses in earlier years.

    Learning Practice

  • 5.3

    Double Declining Balance Method

    The Double Declining Balance Method is an accelerated depreciation technique that calculates depreciation based on the book value of an asset rather than its initial cost.

    Learning Practice

  • 6

    Example: Estimating Depreciation

    Learning

  • 6.1

    Input Data

    Learning

  • 6.2

    Calculation Using Straight Line Method

    This section explores the Straight Line Method of depreciation used to calculate the ownership costs of equipment in construction management.

    Learning Practice

References

2 a.pdf

Class Notes

Memorization

What we have learnt

  • Equipment cost estimation i...
  • Ownership costs include fix...
  • Depreciation significantly ...

Final Test

Revision Tests