Term
| Equipment Cost Elements (Owning) |
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Definition
Depreciation
Investment
Insurance
Taxes
Storage Cost |
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Term
| Equipment Cost Elements (Operating) |
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Definition
Fuel
Service
Repair
Tires
Special Items
Operator's Wages |
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Term
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Definition
Tax Liability
Dep component of hourly equipment cost |
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Term
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Definition
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Term
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Definition
Straight-Line
Sum-of-the-Year's Digits
Double-Declining-Balance
IRS-Prescribed |
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Term
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Definition
(Depreciation)
Uniform for each year |
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Term
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Definition
(Depreciation)
Non-Uniform
Highest in first year
Gradually decreases thereafter
D: Sum of years' digits
N: year digit in inverse order |
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Term
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Definition
(Depreciation)
Max. in first year
Book value not < Salvage |
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Term
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Definition
(Depreciation)
Modified DDB
Doesn't consider salvage cost |
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Term
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Definition
| Depreciation + Investment Cost + Insurance + Taxes + Storage |
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Term
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Definition
(Equipment Economics)
Low Utilization
- Rent--> least expensive
- Purch--> most expensive
Limited Capital and High Utilization
- lease-with-purchase option |
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Term
| Purchasing Equipment (Benefits) |
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Definition
(Equipment Economics)
Least costly
Adequate revenue to cover O&O cost
Greater selection
Accelerated depreciation
Discounts |
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Term
| Purchasing Equipment (Considerations) |
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Definition
(Equipment Economics)
cost
productivity
features and attachments
dealer support |
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Term
| Leasing Equipment(Benefits) |
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Definition
(Equipment Economics)
costs less than renting
when job calls for specialized equipment
when equipment has limited future use |
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Term
| Rental Equipment(Benefits) |
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Definition
(Equipment Economics)
for short-term and unexpected
low utilization
for when job is distant from base of ops |
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Term
| Rental Equipment (Considerations) |
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Definition
(Equipment Economics)
direct cost higher than leasing/purchasing |
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Term
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Definition
| Fuel + Service + Repair + Tire + Special Item + Operator Wages |
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