We have purchased a scraper for $ 730,000 and it is expected to have a life of 12,000 hours and used approximately 2,000 hours per year. The salvage value of this equipment is expected to be $ 112,000. The shipping (freight) cost to deliver the equipment to us is $ 6.00 cwt. The following information applies:

GVW = 92,114 #

Engine = 500 Hp diesel

Crankcase capacity = 5.2 gallons

Oil change cycle = 500 hours

Operating Factor = 0.833

Engine Factor = .80

Combined Engine/Operating Factor = 0.667

Annual Investment Costs = 8 %

Tire Costs = $ 15,000 Tire life = 5,000 hours

Tire Repairs = 14 % of tire depreciation

Maintenance & Repair Cost = 40% depr costs.

Fuel Cost = $ 1.99/gallon Lube Oil Costs = $ 4.00/gallon

Calculate the probable cost of owning and operating the dozer per hour (excluding operator).