2.3 - Cumulative Obsolescence Cost
Enroll to start learning
You’ve not yet enrolled in this course. Please enroll for free to listen to audio lessons, classroom podcasts and take practice test.
Practice Questions
Test your understanding with targeted questions
Calculate the downtime cost if the equipment cost is 1200 rupees per hour at 5%.
💡 Hint: Use the formula: Cost * Percentage.
What is the yearly downtime cost if the downtime cost per hour is 30 rupees for 2000 hours?
💡 Hint: Multiply by the total operating hours.
4 more questions available
Interactive Quizzes
Quick quizzes to reinforce your learning
What is the downtime cost per hour for a machine costing 900 rupees at a 3% downtime rate?
💡 Hint: Remember to calculate the percentage of the equipment cost.
True or False: The obsolescence cost increases as machinery ages.
💡 Hint: Think about how technology evolves.
Get performance evaluation
Challenge Problems
Push your limits with advanced challenges
If a fleet of machines incurs a total downtime cost of 2,000,000 rupees over five years with varying percentages, calculate the average downtime cost per year.
💡 Hint: Consider all years cumulatively and then average them.
A machine has an obsolescence cost of 0.10 in the fourth year and accumulates costs totaling 520,000 rupees over four years. Determine the total cost due to obsolescence for that year and its contribution to the cumulative costs.
💡 Hint: Factor into your calculations the obsolescence percentage.
Get performance evaluation
Reference links
Supplementary resources to enhance your learning experience.