1.4. Cumulative Cost Per Hour Calculation

Try these first

1. 1.

   What is the downtime cost per hour if the equipment cost is 900 rupees and the downtime percentage is 3%?

   Hint

   Calculate 3% of the equipment cost.

2. 2.

   If a machine has a downtime cost of 54,000 rupees, how many hours was it operational if the hourly downtime cost is 27 rupees?

   Hint

   Use the formula: total cost = hourly rate × hours worked.

3. 3.

   What is the downtime cost per hour if the equipment cost is 900 rupees and the downtime percentage is 3%?

   • 27 rupees
   • 30 rupees
   • 20 rupees

   Hint

   Remember the basic percentage calculation.

4. 4.

   Is the cumulative downtime cost of 54,000 rupees at the end of the first year considered high?

   • True
   • False

   Hint

   Consider the financial implications of such a cost annualized over a period.

5. 5.

   Calculate cumulative downtimes for a machine running for five years at varying downtimes of 3%, 6%, 10%, and 12%. Summarize the total costs.

   Hint

   Follow the pattern of yearly calculations and sum them.

6. 6.

   Discuss how a 10% productivity loss in year two, with an additional obsolescence cost of 108 rupees would impact the cumulative costs.

   Hint

   Adjust year two costs for productivity loss to see overall impacts.