Capital Cost when Salvage Value is 0 Calculator

✖Useful Life is termed as an accounting estimate of the number of years it is likely to remain in service for the purpose of cost-effective revenue generation.ⓘ Useful Life [n]			+10% -10%
✖Average Investment is the money which is spent on purchasing an equipment. The average is considered because the capital may not be same due to depreciation.ⓘ Average Investment [I_a]			+10% -10%

✖Capital Cost is fixed, one-time expenses incurred on the purchase of land, buildings, construction, and equipment used in the production of goods or in the rendering of services.ⓘ Capital Cost when Salvage Value is 0 [P_Capital]

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Capital Cost when Salvage Value is 0 Solution

STEP 0: Pre-Calculation Summary

Formula Used

Capital Cost = (2*Useful Life*Average Investment)/(1+Useful Life)
P_Capital = (2*n*I_a)/(1+n)
This formula uses 3 Variables

Variables Used

Capital Cost - Capital Cost is fixed, one-time expenses incurred on the purchase of land, buildings, construction, and equipment used in the production of goods or in the rendering of services.
Useful Life - (Measured in Hour) - Useful Life is termed as an accounting estimate of the number of years it is likely to remain in service for the purpose of cost-effective revenue generation.
Average Investment - Average Investment is the money which is spent on purchasing an equipment. The average is considered because the capital may not be same due to depreciation.

STEP 1: Convert Input(s) to Base Unit

Useful Life: 5 Year --> 43829.1 Hour (Check conversion here)
Average Investment: 1000 --> No Conversion Required

STEP 2: Evaluate Formula

Substituting Input Values in Formula

P_Capital = (2*n*I_a)/(1+n) --> (2*43829.1*1000)/(1+43829.1)

Evaluating ... ...

P_Capital = 1999.95436925766

STEP 3: Convert Result to Output's Unit

1999.95436925766 --> No Conversion Required

FINAL ANSWER

1999.95436925766 ≈ 1999.954 <-- Capital Cost

(Calculation completed in 00.004 seconds)

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Credits

Created by Chandana P Dev

NSS College of Engineering (NSSCE), Palakkad

Chandana P Dev has created this Calculator and 500+ more calculators!

Verified by Mithila Muthamma PA

Coorg Institute of Technology (CIT), Coorg

Mithila Muthamma PA has verified this Calculator and 700+ more calculators!

< Management of Construction Equipment Calculators

Average Investment when Salvage value is 0

LaTeX Go Average Investment = ((1+Useful Life)/(2*Useful Life))*Capital Cost

Book Value for New Machine

LaTeX Go Book Value = (Hourly Depreciation*Life Span)/0.9

Life Span of Machine

LaTeX Go Life Span = 0.9*Book Value/Hourly Depreciation

Hourly Depreciation

LaTeX Go Hourly Depreciation = 0.9*Book Value/Life Span

Capital Cost when Salvage Value is 0 Formula

LaTeX Go

Capital Cost = (2*Useful Life*Average Investment)/(1+Useful Life)
P_Capital = (2*n*I_a)/(1+n)

What are the factors affecting the Cost of Owning and Operating the Construction Equipment?

The different major costs contributing to the cost of owning and operating construction equipment are as follows:
1. Depreciation Cost
2. Investment Cost
3. Maintenance and Repair Cost
4. Operation Costs
a. Repair charges
b. Depreciation on tyres and tubes
c. Labour charges
d. Fuel charges
e. Operation and maintenance crew charges
f. Miscellaneous supplies
5. Downtime Cost
6. Obsolescence Cost
7. Replacement Cost

What is Salvage Value?

Salvage Value is the book value of an asset after all depreciation has been fully expensed. The salvage value of an asset is based on what a company expects to receive in exchange for selling or parting out the asset at the end of its useful life. An asset's estimated salvage value is an important component in the calculation of a depreciation schedule.

How to Calculate Capital Cost when Salvage Value is 0?

Capital Cost when Salvage Value is 0 calculator uses Capital Cost = (2*Useful Life*Average Investment)/(1+Useful Life) to calculate the Capital Cost, The Capital Cost when Salvage Value is 0 formula is defined as a fixed, one-time expense incurred on the purchase of land, buildings, construction, and equipment used in the production of goods or in the rendering of services. In other words, it is the total cost needed to bring a project to a commercially operable status. Capital Cost is denoted by P_Capital symbol.

How to calculate Capital Cost when Salvage Value is 0 using this online calculator? To use this online calculator for Capital Cost when Salvage Value is 0, enter Useful Life (n) & Average Investment (I_a) and hit the calculate button. Here is how the Capital Cost when Salvage Value is 0 calculation can be explained with given input values -> 1999.954 = (2*157784760*1000)/(1+157784760).

FAQ

What is Capital Cost when Salvage Value is 0?

The Capital Cost when Salvage Value is 0 formula is defined as a fixed, one-time expense incurred on the purchase of land, buildings, construction, and equipment used in the production of goods or in the rendering of services. In other words, it is the total cost needed to bring a project to a commercially operable status and is represented as P_Capital = (2*n*I_a)/(1+n) or Capital Cost = (2*Useful Life*Average Investment)/(1+Useful Life). Useful Life is termed as an accounting estimate of the number of years it is likely to remain in service for the purpose of cost-effective revenue generation & Average Investment is the money which is spent on purchasing an equipment. The average is considered because the capital may not be same due to depreciation.

How to calculate Capital Cost when Salvage Value is 0?

The Capital Cost when Salvage Value is 0 formula is defined as a fixed, one-time expense incurred on the purchase of land, buildings, construction, and equipment used in the production of goods or in the rendering of services. In other words, it is the total cost needed to bring a project to a commercially operable status is calculated using Capital Cost = (2*Useful Life*Average Investment)/(1+Useful Life). To calculate Capital Cost when Salvage Value is 0, you need Useful Life (n) & Average Investment (I_a). With our tool, you need to enter the respective value for Useful Life & Average Investment and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.

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