4.1 - Equipment Replacement Analysis Overview
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Practice Questions
Test your understanding with targeted questions
What is the downtime cost per hour for equipment costing 900 rupees with a downtime percentage of 3%?
💡 Hint: Remember to calculate 3% of the total cost.
How much is the yearly downtime cost for a machine operating 2000 hours at a rate of 27 rupees per hour?
💡 Hint: Multiply the downtime cost per hour by the total operating hours.
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Interactive Quizzes
Quick quizzes to reinforce your learning
What is downtime cost calculated as?
💡 Hint: Focus on how we derive the cost based on a percentage.
True or False: Obsolescence cost increases as the equipment ages.
💡 Hint: Consider what happens as machines age over time.
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Challenge Problems
Push your limits with advanced challenges
A company has a machine that costs 1,200 rupees/hour and experiences a Downtime of 1.5% in the first year and 3.5% in the second year. Calculate the yearly downtime costs and cumulative downtime cost after two years.
💡 Hint: Each year calculate based on operation hours and percentages.
If the obsolescence cost for the first three years is 0%, 0.05%, and 0.1% respectively, calculate the cumulative obsolescence costs for the third year based on equipment costs of 1,500 rupees/hour.
💡 Hint: Summing each year’s obsolescence after calculating respective costs.
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