Chapter 18, Problem 18RQ

Calculate the cumulative percent

You and your spouse are planning a second hon- eymoon to the Cayman Islands this summer and would like to have your house painted while you are away. Estimate the total cost of the paint job from the information given below, where: Costtotal = Costpaint + Costjabor + Costfixed Paint information: Your house has a surface area of 6000 ft2. One can of paint can cover 300 ft². You are estimating the cost to put on two coats of paint for the entire house. Number of Cans Purchased Cost per Can $15.00 First 10 cans purchased Second 15 cans purchased Up to next 50 cans purchased $12.50 $12 Labor information: You plan to hire five painters who will paint for 8 hours per day each. You estimate that the job will require 4.5 days of their painting time. The painter's rate is $18 per hour. Fixed cost information: The painting company charges $1200 per job to cover travel expenses, clothing, cloths, thinner, administration, and so on.

A heating supply store buys 6-inch metal flue pipe at $2.90 per 24-inchsection. The pipe is marked up 40%. What is the selling price of one section?

Mrs. Publinsky and her husband, Xander, are planning their dream house. The lot for the house sits high on a hill with a beautiful view of the White Mountains. The plans show the size of the house to be 1,700 square feet. The average price for a lot and house similar to this one has been $116 per square foot. Fortunately, Xander is a retired plumber and feels he can save money by installing the plumbing himself. Mrs. Publinsky feels she can take care of the interior decorating. The following average cost information is available from a local bank that makes loans to local contractors and dispenses progress payments to contractors when specific tasks are verified as complete. 20% Excavation and framing complete 5% Roof and fireplace complete 5% Wiring roughed in 4% Plumbing roughed in 78 Siding on 288 Windows, insulation, walks, plaster, and garage complete 7% Furnace installed 3 Plumbing fixtures installed 8% Exterior paint, light fixtures installed, finish hardware installed Carpet…

You are now to renovate your bedroom to your dream bedroom at a certain budget given by your parents. How are you going to manage the cost of the renovation? There are four primary phases in construction management that you may apply. Explain in sequence each of these phases.

Kitchen Crafters purchases a tile-topped wooden kitchen island list priced at $480. It is available at either in option A 10/15/10 discount or Option B 20/15 discount. Which is cheaper, Option A or B?

A consultant, after 3 months of work, reported that the modified B/C ratio for a city-owned hospital heliport project is 1.3. If the initial cost is $2.5 million and the annual benefits are $130,000, what is the amount of the annual M&O costs used in the calculation? The report stated that a discount rate of 11% per year and an estimated life of 30 years were used. The M&O cost is $

You want a mountain cabin built for weekend trips, vacations, to host family, and perhaps eventually to retire in. After discussing the project with a local contractor, you receive an estimate that the total con- struction cost of your 2000-ft2 lodge will be $250,000. The percentage of costs is broken down as follows: Percentage of Cost Items Total Costs Construction permits, legal and 8 title fees Roadway, site clearing, preparation Foundation, concrete, masonry Wallboard, flooring, carpentry Heating, ventilation, air conditioning (HVAC) Electric, plumbing, communications Roofing, flooring Painting, finishing 15 13 12 13 10 12 17 100 (a) What is the cost per square foot of the 2000-ft2 lodge? (b) If you are also considering a 4000-ft² layout option, estimate your construction costs if: i. All cost items (in the table) change propor- tionately to the size increase. ii. The first two cost items do not change at all; HVAC changes by 50%; and all others are proportionate.

A currently owned shredder for use in a refuse-powered electrical generating plant has a present net realizable value of $210,000 and isexpected to have a market value of $10,000 after 4 years. Operating andmaintenance disbursements are $100,000 per year. An equivalent shredder can be leased for $200 per day plus $80 per hour of actual use as determined by an hour meter, with both components assumed to be paid at the end of the year. Actual use is expected to be 1,500 hours and 250 days per year. Using a 4-year planning horizon and a MARR of 15%, determine the preferred alternative using the annual cost criterion. Solve, a. Consider only the above information and use the cash flow approach (insider’s viewpoint approach). b. Consider the additional information that the annual cost of operating without a shredder is $190,000 and use the cash flow approach (insider’s viewpoint approach).