- ANS-
"Boilerplate"nisnantermnappliedntonconditionsnthatntendntonbenpredeterminednandnautomaticallyninclu
dedninnallnofnanbusiness'sncontracts.nThenmajoritynofnthesentendntonbendisclaimersnandnlegalnprotect
ionsnregardingnthingsnsuchnasnmediation,narbitration,nattorneysnfees,netc.nBencertainntonreadnthesen
justnasncarefullynbecausentheyncannhavenandirectnimpactnonnanynlegalnactionsnthatntakenplaceninnth
eneventnofnanproblem.
- ANS-
"Overlapping"nofnFMLAnandnOFLAnwithnWorkers'nCompensationnandnADAnandnOregonnDisabilit
ynLaws
Whenncoverednbynmorenthannonenemploymentnlaw,nthenemployernmustnfollownthenonenmostnbene
ficialntonthenemployee.nLargerncompaniesnwillnbencoverednbynbothnOFLAnandnFMLA.nThenOFLAna
ppliesntonemployersnwithn25nornmorenemployeesnwhereasnFMLAnappliesntonemployersnwithn50norn
morenemployees.
- ANS-10.nCalculatenYournMarkupnandnProfitnMargin
ClicknTonEnlarge
Nownyounarenreadyntonaddnthenfinishingntouchn-
nyournprofit.nEverynestimatenmustnincludenanprofit,notherwisenwhat'snthenpoint?
Thingsntonconsidernfornanprofitnthatnwillngetnyounbusinessnandnbenenoughntonkeepnyouninnbusiness,ni
nclude:
Yourncostnestimate
Thencustomer'snneedsnandnexpectationsnL
ocalnmarketnandncompetition
Desirednprofitnmargin
Onenofnthenmostncommonnmethodsnforndeterminingnthenfinalnmarkupnand,nthereby,nyournbid,nisn
cost-basednpricing.nThenbasicnformulanforncalculatingnthroughnthisnmethodnis:
CostnEstimaten+nOverheadn+nProfitnMarkupn=nBid
Innourncurrentnexample,nwenhavenaddednthenfirstntwonitemsnandnarrivednatn$11,364.00.nNownwenne
edntonfigurenwhatnwenwantnournprofitnmarginntonbe,nandnwenhavenournbid.
Thisnisnwherenknowledgenofnyournmarketncanngivenyounantruencompetitivenedge.nBidntoonlownandnan
ynunforeseenndelaysnornaddednexpensesncannrapid
- ANS-2.nAddnLabornBurden
Expensesnrelatedntonwagesnornrequirednpayrollndeductionsnandnothernemployernobligationsncannad
dnasnmuchnasn30%ntonyournlaborncosts.nThisnisncallednthen"labornburden".
Examplesnofnthesenhiddennexpensesninclude:nFede
ralnandnstatenwithholdingn(SeenCh.n14)nUnemploy
mentninsurancen(SeenChs.n3n&n14)
FederalnInsurancenContributionnActn(FICA)n(SeenCh.n14)nMedi
carenandnSocialnSecurityn(SeenCh.n14)
Workers'ncompensationninsurancen(SeenChs.n3n&n14)
,Employeenbenefitsn(healthncare,nvacation,netc.)
Annemployeentrustnbenefitnalsoncannbenannindirectnlaborncost.
- ANS-2010nOregonnManufacturednDwellingnInstallationnSpecialtynCode
EffectivenApriln1,n2010,nOregonnadoptednthennewnManufacturednDwellingnInstallationnSpecialtynCo
den(MDISC)ntonreplacenthen2002nManufacturednDwellingnandnParknSpecialtynCoden(MD&P).nThenn
ewnMDISCncodenisnbasednonnthen2002nMD&P,nU.S.nDepartmentnofnHousingnandnUrbannDevelopm
entn(HUD)ninstallationnstandards,nandnnationalnrecognizednmanufacturednDwellingninstallationnsta
ndards.
- ANS-2010nOregonnManufacturednDwellingnInstallationnSpecialtynCode
EffectivenApriln1,n2010,nOregonnadoptednthennewnManufacturednDwellingnInstallationnSpecialtynCo
den(MDISC)ntonreplacenthen2002nManufacturednDwellingnandnParknSpecialtynCoden(MD&P).nThenn
ewnMDISCncodenisnbasednonnthen2002nMD&P,nU.S.nDepartmentnofnHousingnandnUrbannDevelopm
entn(HUD)ninstallationnstandards,nandnnationalnrecognizednmanufacturednDwellingninstallationnsta
ndards.
- ANS-2010nOregonnSolarnInstallationnSpecialtynCode
EffectivenOctobern1,n2010,nthendivisionnadoptednthen2010nOregonnSolarnInstallationnSpecialtynCod
en(OSISC),nthenfirstnsolarncodenfornOregonnandnthenfirstnstatewidensolarncodeninnthenNation.nThenCo
denisnpartnofnthendivision'snoverallngoalntonfacilitatengreennbuildingntechnologies.
ThenOSISCnstandardsnarenforntheninstallationnofnthenstructuralncomponentsnforninstallation,nalterat
ion,nreplacementnornrepairnofnsolarnphotovoltaicnsystems.nThenelectricalnrequirementsnarencontain
edninnthenOregonnElectricalnSpecialtynCodenandnreproducedninnthenOSISC'snappendixnA.
- ANS-2014nOregonnEnergynEfficiencynSpecialtynCode
Oregonnhasnadoptednannewnstand-
alonencodentonaddressnenergynissuesninnconstructionninnOregon.nThen2014nOregonnEnergynEfficie
ncynSpecialtynCoden(OEESC)nwasnadoptedneffectivenJulyn1,n2014nwithnangracenperiodnextendingnt
onOctobern1,n2014.nThisnisnthenlastncodencyclenwherenthenenergynprovisionsnwillnbenpublishednasnan
separatenpublication.nInnthenfollowingncodencyclesnthisnwillnbenansubsetnofnthenOSSC.
- ANS-2014nOregonnFirenCode
Then2014nOregonnFirenCodenisnbasednonnthen2014nICCnInternationalnFirenCodenwithnOregonnamen
dments.
- ANS-2014nOregonnMechanicalnSpecialtynCoden(OMSC)
Oregonnadoptednthen2014n(OMSC),nwhichnisnbasednonnthen2012nInternationalnMechanicalnCode,n
Oregonnamendmentsnandnthen2012nInternationalnFuelnGasnCodenasnannappendix.nThenOMSCnapp
liesntonallnstructuresnnotncoverednundernthenOregonnResidentialnSpecialtynCode.
- ANS-2014nOregonnStructuralnSpecialtynCoden(OSSC)
,ThenOSSCnconsistsnofnthen2011neditionnofnthenInternationalnBuildingnCodenwithnOregonnamen
dments,nwhichnwasneffectivenJulyn1,n2014nwithnangracenperiodnextendingntonOctobern1,n2014.
ThisncodenappliesntonallnstructuresnnotnregulatednundernthenOregonnResidentialnSpecialtynCode,nin
cludingnthenfollowing
Commercialnstructures
Transientnlodging,nsuchnasnhotelsnandnmotels
CertainnresidentialnstructuresnsubjectntonlicensurenbynthenOregonnDepartmentnofnHumannServicesn
Low-risenmultiplenfamilyndwellings
- ANS-2017nOregonnElectricalnSpecialtynCoden(OESC)
Oregonnadoptednthen2017nOregonnElectricalnSpecialtynCodeneffectivenOctobern1,n2017,nwhichnisnb
asednonnthen2017neditionnofnthenNFPAn70,nNationalnElectricalnCodenamendmentsntonthen2017nNE
C??nadoptednOct.n1,n2017.nThisncodencontainsnrequirementsnfornelectricalninstallations.
- ANS-2017nOregonnResidentialnSpecialtynCode
Oregonnadoptednthen2017nOregonnResidentialnSpecialtynCodeneffectivenOctobern1,n2017.nItnisnba
sednonnthen2015neditionnofnthenICCnInternationalnResidentialnCodenwithnenhancementsnaddedninn2
017.
ThenplumbingnandnelectricalnchaptersnofnthenInternationalnCodenarennotnusedninnOregon.nThenOreg
onnStatenPlumbingnCodenandnthenOregonnStatenElectricalnCodenapplyninnOregon.
ThenscopenofnthenOregonnResidentialnSpecialtynCodenhasnbeennexpandedntonincludenmultifamilynu
nitsnandnincludesn-nwithnlimitationsn-
ntownhouses,napartments,nandnrownhousesnincludingntheirnaccessorynstructures.nRownhousesnaren
coveredninnAppendixnOnofnthenOregonnResidentialnSpecialtynCode.
- ANS-2017nOregonnResidentialnSpecialtynCode
Oregonnadoptednthen2017nOregonnResidentialnSpecialtynCodeneffectivenOctobern1,n2017.nItnisnba
sednonnthen2015neditionnofnthenICCnInternationalnResidentialnCodenwithnenhancementsnaddedninn2
017.
ThenplumbingnandnelectricalnchaptersnofnthenInternationalnCodenarennotnusedninnOregon.nThenOreg
onnStatenPlumbingnCodenandnthenOregonnStatenElectricalnCodenapplyninnOregon.
ThenscopenofnthenOregonnResidentialnSpecialtynCodenhasnbeennexpandedntonincludenmultifamilynu
nitsnandnincludesn-nwithnlimitationsn-
ntownhouses,napartments,nandnrownhousesnincludingntheirnaccessorynstructures.nRownhousesnaren
coveredninnAppendixnOnofnthenOregonnResidentialnSpecialtynCode.
- ANS-3.nDeterminenMaterialsnCosts
Fornmaterials,nyounwantntonfollownansimilarnprocessntonthenlabornestimating.nWorkingnfromnyournesti
matenframework,ncalculatenthencostnforneachnmaterialnitemnlisted.nThisnisnanothernareanwherenhavi
ngnyournhistoricalndatanavailablenwillnbenanhugenhelp,nhowever,nyounalsonneedntonstaynabreastnofnth
enmarketnbecausenmaterialncostsncannfluctuatendramaticallynbasednonnsupplynandndemand/navaila
bility.
, Yournsuppliersnarenthenbestnsourcenforncurrentninformation.nTheyncannprovideneithernpernunitnornl
ump-
sumncostsntonassistnyournestimate.nAlternatively,nthenU.S.nBureaunofnLaborn&nStatisticsntracksnt
hencostsnofnmajorngroupsnofnconstructionnmaterialsninnthenProducernPricenIndexn(PPI)nprogram.
Ifnyounreceiventhencostsnpernunit,nyouncannapplynthenfollowingnformulantonhelpndeterminenthenexpect
edncostnforneachncategorynofnmaterial:
PricenpernUnitnxnNumbernofnUnitsnNeededn=nTotalnMaterialnUnitnCostnT
onensure
- ANS-4.nCalculatenProjectnEquipment
Equipmentncostsngenerallynarendirectncosts.nEquipmentnspecificntonanproject,ne.g.,nrentalnofnanforklif
t,ncrane,nbackhoe,netc.,nspecificallynfornthenprojectnisnandirectncostnandnshouldnbenaddedntonyournest
imate.nSmallntoolsnandncompany-
ownednvehiclesnthatnarenusednregularlynfornjobsnandnnotnspecificntonanparticularnprojectnarenoverhea
dnandnshouldnnotnbenincludednhere.
Therenarendifferentnwaysntoncalculatenthendirectncostndependingnonnwhethernyounown,nrent,nsubcont
ract,nornlease.
- ANS-
4.nCalculatenProjectnEquipmentnOwned
nEquipment
Beginnbyndeterminingnthenpernunitncost,nconsideringnthenfollowingnfactors:n
Actualnvaluenofnequipmentn(includingnage,ndepreciation,netc.)nMaintenanc
enandnoperatingncostsn(e.g.,nfuel)
Taxesnandnfees
Laborntonoperaten(includingntrainingnornlicensingnifnapplicable)nI
nsurance
Toncalculatenthencostnfornthenproject:
Estimatenthennumbernofnhoursnpernyearnthenequipmentnisnusedn
Determinenthenannualncostntonownnandnoperatenthenequipmentn
Dividenthencostnbynthennumbernofnhours
ThennmultiplynthenhourlynratenbynthennumbernofnhoursnexpectedntonbenneedednfornthisnprojectnT
henformulanlooksnlikenthis:
Costnofnequipmentnpernyearn/nNumbernofnhoursnusednpernyearn=nCost
Fornexample,nanpiecenofnequipmentncostn$10,000npernyearntonownnandnmaintain.nYounusenthenequ
ipmentn1000nhoursnpernyear.nYourncostnisn$10npernhour.nOnnthisnprojectnyoundeterminenyounwillnne
edn50nhoursnofnusenofnthisnequipment.nY
- ANS-
4.nPreparingnFinancialnStatementsnBalanc
enSheet
Long-termnLiabilities
Oppositenofncurrentnliabilities,n"long-
termnliabilities"narenitems,ne.g.,nbanknloans,ndeferredntaxnpayments,nthatnarendueninnantimenperiodnlo
ngernthannonenyear.
- ANS-
4.nPreparingnFinancialnStatementsnBalanc
"Boilerplate"nisnantermnappliedntonconditionsnthatntendntonbenpredeterminednandnautomaticallyninclu
dedninnallnofnanbusiness'sncontracts.nThenmajoritynofnthesentendntonbendisclaimersnandnlegalnprotect
ionsnregardingnthingsnsuchnasnmediation,narbitration,nattorneysnfees,netc.nBencertainntonreadnthesen
justnasncarefullynbecausentheyncannhavenandirectnimpactnonnanynlegalnactionsnthatntakenplaceninnth
eneventnofnanproblem.
- ANS-
"Overlapping"nofnFMLAnandnOFLAnwithnWorkers'nCompensationnandnADAnandnOregonnDisabilit
ynLaws
Whenncoverednbynmorenthannonenemploymentnlaw,nthenemployernmustnfollownthenonenmostnbene
ficialntonthenemployee.nLargerncompaniesnwillnbencoverednbynbothnOFLAnandnFMLA.nThenOFLAna
ppliesntonemployersnwithn25nornmorenemployeesnwhereasnFMLAnappliesntonemployersnwithn50norn
morenemployees.
- ANS-10.nCalculatenYournMarkupnandnProfitnMargin
ClicknTonEnlarge
Nownyounarenreadyntonaddnthenfinishingntouchn-
nyournprofit.nEverynestimatenmustnincludenanprofit,notherwisenwhat'snthenpoint?
Thingsntonconsidernfornanprofitnthatnwillngetnyounbusinessnandnbenenoughntonkeepnyouninnbusiness,ni
nclude:
Yourncostnestimate
Thencustomer'snneedsnandnexpectationsnL
ocalnmarketnandncompetition
Desirednprofitnmargin
Onenofnthenmostncommonnmethodsnforndeterminingnthenfinalnmarkupnand,nthereby,nyournbid,nisn
cost-basednpricing.nThenbasicnformulanforncalculatingnthroughnthisnmethodnis:
CostnEstimaten+nOverheadn+nProfitnMarkupn=nBid
Innourncurrentnexample,nwenhavenaddednthenfirstntwonitemsnandnarrivednatn$11,364.00.nNownwenne
edntonfigurenwhatnwenwantnournprofitnmarginntonbe,nandnwenhavenournbid.
Thisnisnwherenknowledgenofnyournmarketncanngivenyounantruencompetitivenedge.nBidntoonlownandnan
ynunforeseenndelaysnornaddednexpensesncannrapid
- ANS-2.nAddnLabornBurden
Expensesnrelatedntonwagesnornrequirednpayrollndeductionsnandnothernemployernobligationsncannad
dnasnmuchnasn30%ntonyournlaborncosts.nThisnisncallednthen"labornburden".
Examplesnofnthesenhiddennexpensesninclude:nFede
ralnandnstatenwithholdingn(SeenCh.n14)nUnemploy
mentninsurancen(SeenChs.n3n&n14)
FederalnInsurancenContributionnActn(FICA)n(SeenCh.n14)nMedi
carenandnSocialnSecurityn(SeenCh.n14)
Workers'ncompensationninsurancen(SeenChs.n3n&n14)
,Employeenbenefitsn(healthncare,nvacation,netc.)
Annemployeentrustnbenefitnalsoncannbenannindirectnlaborncost.
- ANS-2010nOregonnManufacturednDwellingnInstallationnSpecialtynCode
EffectivenApriln1,n2010,nOregonnadoptednthennewnManufacturednDwellingnInstallationnSpecialtynCo
den(MDISC)ntonreplacenthen2002nManufacturednDwellingnandnParknSpecialtynCoden(MD&P).nThenn
ewnMDISCncodenisnbasednonnthen2002nMD&P,nU.S.nDepartmentnofnHousingnandnUrbannDevelopm
entn(HUD)ninstallationnstandards,nandnnationalnrecognizednmanufacturednDwellingninstallationnsta
ndards.
- ANS-2010nOregonnManufacturednDwellingnInstallationnSpecialtynCode
EffectivenApriln1,n2010,nOregonnadoptednthennewnManufacturednDwellingnInstallationnSpecialtynCo
den(MDISC)ntonreplacenthen2002nManufacturednDwellingnandnParknSpecialtynCoden(MD&P).nThenn
ewnMDISCncodenisnbasednonnthen2002nMD&P,nU.S.nDepartmentnofnHousingnandnUrbannDevelopm
entn(HUD)ninstallationnstandards,nandnnationalnrecognizednmanufacturednDwellingninstallationnsta
ndards.
- ANS-2010nOregonnSolarnInstallationnSpecialtynCode
EffectivenOctobern1,n2010,nthendivisionnadoptednthen2010nOregonnSolarnInstallationnSpecialtynCod
en(OSISC),nthenfirstnsolarncodenfornOregonnandnthenfirstnstatewidensolarncodeninnthenNation.nThenCo
denisnpartnofnthendivision'snoverallngoalntonfacilitatengreennbuildingntechnologies.
ThenOSISCnstandardsnarenforntheninstallationnofnthenstructuralncomponentsnforninstallation,nalterat
ion,nreplacementnornrepairnofnsolarnphotovoltaicnsystems.nThenelectricalnrequirementsnarencontain
edninnthenOregonnElectricalnSpecialtynCodenandnreproducedninnthenOSISC'snappendixnA.
- ANS-2014nOregonnEnergynEfficiencynSpecialtynCode
Oregonnhasnadoptednannewnstand-
alonencodentonaddressnenergynissuesninnconstructionninnOregon.nThen2014nOregonnEnergynEfficie
ncynSpecialtynCoden(OEESC)nwasnadoptedneffectivenJulyn1,n2014nwithnangracenperiodnextendingnt
onOctobern1,n2014.nThisnisnthenlastncodencyclenwherenthenenergynprovisionsnwillnbenpublishednasnan
separatenpublication.nInnthenfollowingncodencyclesnthisnwillnbenansubsetnofnthenOSSC.
- ANS-2014nOregonnFirenCode
Then2014nOregonnFirenCodenisnbasednonnthen2014nICCnInternationalnFirenCodenwithnOregonnamen
dments.
- ANS-2014nOregonnMechanicalnSpecialtynCoden(OMSC)
Oregonnadoptednthen2014n(OMSC),nwhichnisnbasednonnthen2012nInternationalnMechanicalnCode,n
Oregonnamendmentsnandnthen2012nInternationalnFuelnGasnCodenasnannappendix.nThenOMSCnapp
liesntonallnstructuresnnotncoverednundernthenOregonnResidentialnSpecialtynCode.
- ANS-2014nOregonnStructuralnSpecialtynCoden(OSSC)
,ThenOSSCnconsistsnofnthen2011neditionnofnthenInternationalnBuildingnCodenwithnOregonnamen
dments,nwhichnwasneffectivenJulyn1,n2014nwithnangracenperiodnextendingntonOctobern1,n2014.
ThisncodenappliesntonallnstructuresnnotnregulatednundernthenOregonnResidentialnSpecialtynCode,nin
cludingnthenfollowing
Commercialnstructures
Transientnlodging,nsuchnasnhotelsnandnmotels
CertainnresidentialnstructuresnsubjectntonlicensurenbynthenOregonnDepartmentnofnHumannServicesn
Low-risenmultiplenfamilyndwellings
- ANS-2017nOregonnElectricalnSpecialtynCoden(OESC)
Oregonnadoptednthen2017nOregonnElectricalnSpecialtynCodeneffectivenOctobern1,n2017,nwhichnisnb
asednonnthen2017neditionnofnthenNFPAn70,nNationalnElectricalnCodenamendmentsntonthen2017nNE
C??nadoptednOct.n1,n2017.nThisncodencontainsnrequirementsnfornelectricalninstallations.
- ANS-2017nOregonnResidentialnSpecialtynCode
Oregonnadoptednthen2017nOregonnResidentialnSpecialtynCodeneffectivenOctobern1,n2017.nItnisnba
sednonnthen2015neditionnofnthenICCnInternationalnResidentialnCodenwithnenhancementsnaddedninn2
017.
ThenplumbingnandnelectricalnchaptersnofnthenInternationalnCodenarennotnusedninnOregon.nThenOreg
onnStatenPlumbingnCodenandnthenOregonnStatenElectricalnCodenapplyninnOregon.
ThenscopenofnthenOregonnResidentialnSpecialtynCodenhasnbeennexpandedntonincludenmultifamilynu
nitsnandnincludesn-nwithnlimitationsn-
ntownhouses,napartments,nandnrownhousesnincludingntheirnaccessorynstructures.nRownhousesnaren
coveredninnAppendixnOnofnthenOregonnResidentialnSpecialtynCode.
- ANS-2017nOregonnResidentialnSpecialtynCode
Oregonnadoptednthen2017nOregonnResidentialnSpecialtynCodeneffectivenOctobern1,n2017.nItnisnba
sednonnthen2015neditionnofnthenICCnInternationalnResidentialnCodenwithnenhancementsnaddedninn2
017.
ThenplumbingnandnelectricalnchaptersnofnthenInternationalnCodenarennotnusedninnOregon.nThenOreg
onnStatenPlumbingnCodenandnthenOregonnStatenElectricalnCodenapplyninnOregon.
ThenscopenofnthenOregonnResidentialnSpecialtynCodenhasnbeennexpandedntonincludenmultifamilynu
nitsnandnincludesn-nwithnlimitationsn-
ntownhouses,napartments,nandnrownhousesnincludingntheirnaccessorynstructures.nRownhousesnaren
coveredninnAppendixnOnofnthenOregonnResidentialnSpecialtynCode.
- ANS-3.nDeterminenMaterialsnCosts
Fornmaterials,nyounwantntonfollownansimilarnprocessntonthenlabornestimating.nWorkingnfromnyournesti
matenframework,ncalculatenthencostnforneachnmaterialnitemnlisted.nThisnisnanothernareanwherenhavi
ngnyournhistoricalndatanavailablenwillnbenanhugenhelp,nhowever,nyounalsonneedntonstaynabreastnofnth
enmarketnbecausenmaterialncostsncannfluctuatendramaticallynbasednonnsupplynandndemand/navaila
bility.
, Yournsuppliersnarenthenbestnsourcenforncurrentninformation.nTheyncannprovideneithernpernunitnornl
ump-
sumncostsntonassistnyournestimate.nAlternatively,nthenU.S.nBureaunofnLaborn&nStatisticsntracksnt
hencostsnofnmajorngroupsnofnconstructionnmaterialsninnthenProducernPricenIndexn(PPI)nprogram.
Ifnyounreceiventhencostsnpernunit,nyouncannapplynthenfollowingnformulantonhelpndeterminenthenexpect
edncostnforneachncategorynofnmaterial:
PricenpernUnitnxnNumbernofnUnitsnNeededn=nTotalnMaterialnUnitnCostnT
onensure
- ANS-4.nCalculatenProjectnEquipment
Equipmentncostsngenerallynarendirectncosts.nEquipmentnspecificntonanproject,ne.g.,nrentalnofnanforklif
t,ncrane,nbackhoe,netc.,nspecificallynfornthenprojectnisnandirectncostnandnshouldnbenaddedntonyournest
imate.nSmallntoolsnandncompany-
ownednvehiclesnthatnarenusednregularlynfornjobsnandnnotnspecificntonanparticularnprojectnarenoverhea
dnandnshouldnnotnbenincludednhere.
Therenarendifferentnwaysntoncalculatenthendirectncostndependingnonnwhethernyounown,nrent,nsubcont
ract,nornlease.
- ANS-
4.nCalculatenProjectnEquipmentnOwned
nEquipment
Beginnbyndeterminingnthenpernunitncost,nconsideringnthenfollowingnfactors:n
Actualnvaluenofnequipmentn(includingnage,ndepreciation,netc.)nMaintenanc
enandnoperatingncostsn(e.g.,nfuel)
Taxesnandnfees
Laborntonoperaten(includingntrainingnornlicensingnifnapplicable)nI
nsurance
Toncalculatenthencostnfornthenproject:
Estimatenthennumbernofnhoursnpernyearnthenequipmentnisnusedn
Determinenthenannualncostntonownnandnoperatenthenequipmentn
Dividenthencostnbynthennumbernofnhours
ThennmultiplynthenhourlynratenbynthennumbernofnhoursnexpectedntonbenneedednfornthisnprojectnT
henformulanlooksnlikenthis:
Costnofnequipmentnpernyearn/nNumbernofnhoursnusednpernyearn=nCost
Fornexample,nanpiecenofnequipmentncostn$10,000npernyearntonownnandnmaintain.nYounusenthenequ
ipmentn1000nhoursnpernyear.nYourncostnisn$10npernhour.nOnnthisnprojectnyoundeterminenyounwillnne
edn50nhoursnofnusenofnthisnequipment.nY
- ANS-
4.nPreparingnFinancialnStatementsnBalanc
enSheet
Long-termnLiabilities
Oppositenofncurrentnliabilities,n"long-
termnliabilities"narenitems,ne.g.,nbanknloans,ndeferredntaxnpayments,nthatnarendueninnantimenperiodnlo
ngernthannonenyear.
- ANS-
4.nPreparingnFinancialnStatementsnBalanc
