Practice Ownership Cost - 3.2.1 | 5. Construction Methods and Equipment Management | Construction Engineering & Management - Vol 1
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Knowledge

3.2.1 - Ownership Cost

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Learning

Practice Questions

Test your understanding with targeted questions related to the topic.

Question 1

Easy

Define ownership cost.

💡 Hint: Think about costs that are constant regardless of how much you use the equipment.

Question 2

Easy

What is included in the initial cost of equipment?

💡 Hint: Consider all expenses related to acquiring the equipment.

Practice 4 more questions and get performance evaluation

Interactive Quizzes

Engage in quick quizzes to reinforce what you've learned and check your comprehension.

Question 1

What are ownership costs?

💡 Hint: Think about costs that do not vary with operation.

Question 2

True or False: Operating costs are incurred whether the equipment is used or not.

  • True
  • False

💡 Hint: Consider when costs are incurred.

Solve 1 more question and get performance evaluation

Challenge Problems

Push your limits with challenges.

Question 1

A construction company purchases a backhoe for $120,000, with an expected salvage value of $15,000 and a useful life of 7 years. Calculate the annual depreciation using the straight-line method and discuss how this affects the overall project budgeting.

💡 Hint: Use the straight-line formula you learned.

Question 2

Explain the financial implications of choosing an accelerated depreciation method versus a straight-line method for a newly acquired piece of equipment worth $75,000 with a salvage value of $5,000 over a useful life of 10 years.

💡 Hint: Compare the benefits and drawbacks of each method in financial reporting.

Challenge and get performance evaluation