A 400-fwhp diesel-powered dozer will be used to support a scraper fleet. This dozer was purchased for $395,000. The estimated salvage value at the end of 4 years is $105,000. The company’s cost-of-capital is 7.6%. The work will be at an efficiency equal to a 50-min hour. The engine will work at full throttle while push loading the scrapers (59% of the time) and a three-quarter throttle to travel and position. The crankcase capacity is 16 gal and the company has a policy to change oil every 150 hours. The annual cost of repairs equals 68% of the straight-line machine depreciation. Fuel cost $1.03/gal. and oil is $2.53/gal. The cost of other lubricants and filters is $0.65/hr. The dozer will work 1,800 hr/yr. In this usage, the estimated life for cutting edges is 410 hours. The local price for a set of cutting edges is $1,300. What is the operating cost for the dozer in this application?
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