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3 cards from this section. Quick, good the night before a test.
What does FOG stand for?
Think about consumables for machinery.
How do you calculate hourly depreciation?
Recall the formula shared in class.
What does FOG stand for?
Consider the essential maintenance items.
True or False: The Peurifoy method ignores the time value of money.
Think about the importance of cash flow timings.
A construction company is deciding between two excavators. Excavator A has an initial cost of $250,000, a salvage value of $25,000, and an expected life of 15,000 hours. Excavator B has an initial cost of $300,000, a salvage value of $30,000, and 10,000 hours of expected life. Calculate the hourly depreciation for both and determine which is more cost-effective in terms of depreciation.
Use the depreciation formula you learned to analyze both options.
If an equipment's FOG needs to be calculated with 0.15 as a FOG factor and the calculated fuel cost is $80 per hour, what will be the hourly cost for FOG?
Multiply the FOG factor by the total fuel cost to find the answer.
7 more questions in this section. Enroll free to practise them all.
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