EXERCISE 1

1. You are required to analyse and calculate cost of an excavator. Provide cost of
operating the excavator in 1 hour.
– Cost of excavator RM 350,000
– Estimated plant maintenance cost RM 35,000/5yr
– Duration of use 5 yr
– Yearly interest rate 10%
– Usage rate in a year 275 days
– Operator cost RM 40/day
– Diesel (daily) RM 50
– Grease (daily) RM 5

2. You are required to do an excavation work as part of site clearing activity. The
excavation should not exceed 300mm depth (average depth is 150mm) for a 900 m2
field area. Type of soil is sand, and all excavation works to be done manually. If gross
profit required is 15%, how much cost for the site clearing is needed.

Given information:
Labour constant
– Excavation not more than 300mm (average 150mm) - 0.58hr/m2
– Levelling the excavated level 0.12hr/m2
– Discarding excavated materials 1.2hr/m3
– Daily labour rate 40.00