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- Committed contracts for 15 years <br />- New conveyor capital cost = $5,000,000,00 <br />• - Maintenance cost = 3% initial cost <br />- One new person required to operate and maintain conveyor <br />- Prime interest lendiny rate = 10% <br />- Direct labor cost of person is $30,000.UU/yr <br />- Fringe benefits are 40% of direct labor cost <br />- Conveyor will yenerate 50 HP of excess power <br />- 1 KW-hr of power costs $0.06 <br />- Conveyor salvaye value = 8% initial cost <br />TRIICK HAl1LAGE f,OSTS <br />EXAMPLE <br />Operating Costs <br />1,000,000 tons X $0.50 -_ 5500,Of10/year <br />yr ton <br />Maintenance Costs <br />$300,000 = $30,000/year <br />10 yea r <br />Present Worth Costs <br />P - represents a present sum of money <br />F - represents a sum of money at the end of "n" periods from the <br />. present date that is equivalent to "P" with interest "i". <br />A - represents the end-of-period payment or receipt in a uniform series <br />continuiny for the coming "n" periods, the entire series equivalent <br />to "P" at interest rate "i", <br />Present Worth Factor = (P/A, 10y, 15) = 7,fi0fi <br />_ (P/F, 10%, 15) _ ,2394 <br />Present. Worth Casts <br />S 5DO,000 (7,606) _ $ 3,803,000 <br />+ 30,000 (7,606) _ + 228,180 <br />$ 4,031,180 <br />Present Worth Costs = $4,031,180 <br />OVERLAND CONVEYOR COSTS <br />EXAMPLE <br />Capital Expenditure Costs <br />Based on January, 1984 Dollars = $5,000,000 <br />Salvage Value @ 10% <br />$5,000,000 X ,10 (Future Value) _ $ 500,000 <br />5 <br />