Comprehensive Ownership and Operating Cost (CM
2113) Quiz with Calculations – Construction Equipment
Management Practice Questions & Answers
Replacing equipment tires are a/an ___________.
Select one:
a. Ownership Cost
b. Operating Cost
b. Operating Cost
Taxes paid on the purchase of a piece of equipment are a/an ___________.
Select one:
a. Operating Cost
b. Ownership Cost
b. Ownership Cost
The equipment operator is a/an ___________.
Select one:
a. Ownership Cost
b. Operating Cost
b. Operating Cost
O&O costs are usually expressed in dollars per equipment operating hour.
Select one:
True
False
True
Tires for wheel-type equipment are a major operating cost, because they have a
short life in relation to the iron of a machine.
Select one:
, True
False
True
Tire cost will include both repair and replacement charges, and the tire life is a
function of both project application and equipment/project management.
Select one:
True
False
True
A contractor has purchased a wheel loader for $115,000 and plans to use it
2,000 hours per year. The cost of one set of tires is $25,000. At this usage rate,
the contractor anticipates disposing of the loader after using it for 10 years and
realizing a salvage value of $35,000. The flywheel horsepower rating of the
loader’s diesel engine is 105 horsepower. The interest rate is 10%. The loader
operator will earn $34.00 per hour including fringe benefits, and diesel fuel
costs $1.20 per gallon.
How much is the contractor’s hourly depreciation portion of ownership cost for
the loader if using the Time Value Method (see textbook page 42 Example 2.8
for reference)?
Select one:
a. $6.23/hr
b. $8.27/hr
c. $7.43/hr
d. $9.37/hr
a. $6.23/hr
How much is the contractor’s hourly depreciation portion of ownership cost for
the loader if using the Average Annual Investment Method (see textbook page
44 Example 2.9 for reference)?
2113) Quiz with Calculations – Construction Equipment
Management Practice Questions & Answers
Replacing equipment tires are a/an ___________.
Select one:
a. Ownership Cost
b. Operating Cost
b. Operating Cost
Taxes paid on the purchase of a piece of equipment are a/an ___________.
Select one:
a. Operating Cost
b. Ownership Cost
b. Ownership Cost
The equipment operator is a/an ___________.
Select one:
a. Ownership Cost
b. Operating Cost
b. Operating Cost
O&O costs are usually expressed in dollars per equipment operating hour.
Select one:
True
False
True
Tires for wheel-type equipment are a major operating cost, because they have a
short life in relation to the iron of a machine.
Select one:
, True
False
True
Tire cost will include both repair and replacement charges, and the tire life is a
function of both project application and equipment/project management.
Select one:
True
False
True
A contractor has purchased a wheel loader for $115,000 and plans to use it
2,000 hours per year. The cost of one set of tires is $25,000. At this usage rate,
the contractor anticipates disposing of the loader after using it for 10 years and
realizing a salvage value of $35,000. The flywheel horsepower rating of the
loader’s diesel engine is 105 horsepower. The interest rate is 10%. The loader
operator will earn $34.00 per hour including fringe benefits, and diesel fuel
costs $1.20 per gallon.
How much is the contractor’s hourly depreciation portion of ownership cost for
the loader if using the Time Value Method (see textbook page 42 Example 2.8
for reference)?
Select one:
a. $6.23/hr
b. $8.27/hr
c. $7.43/hr
d. $9.37/hr
a. $6.23/hr
How much is the contractor’s hourly depreciation portion of ownership cost for
the loader if using the Average Annual Investment Method (see textbook page
44 Example 2.9 for reference)?
