You need to determine the (1) ownership unit cost (hourly cost) for a D6 dozer. Use both Time Value Method and Average Annual Value (AAV) Method (Assumes straight-line depreciation). (2) Operation costs (hourly cost) (List the value of each factor) The following information is known: Purchase Price = $350,000 Cost of Dozer Tracks Price = $25,000 Service Life = 5 years Utilization Anticipated per year = 2,000 hours Cost of Capital = 12% Residual Value = $70,000 Cost of Equipment Operator = $30/hr Cost of Fuel to Operate = 20 gallons per hour at $4/gallon Cost of Wear Items = 1,000 hours per set at $5,000 per set

1. (50 points) You need to determine the (1) ownership unit cost (hourly cost) for a D6 dozer. Use both Time Value Method and Average Annual Value (AAV) Method (Assumes straight-line depreciation). (2) Operation costs (hourly cost) (List the value of each factor) The following information is known: Purchase Price = $350,000 Cost of Dozer Tracks Price = $25,000 . Service Life = 5 years Utilization Anticipated per year = 2,000 hours Cost of Capital = 12% Residual Value = $70,000 Cost of Equipment Operator = $30/hr Cost of Fuel to Operate = 20 gallons per hour at $4/gallon Cost of Wear Items = 1,000 hours per set at $5,000 per set 1. (50 points) You need to determine the (1) ownership unit cost (hourly cost) for a D6 dozer. Use both Time Value Method and Average Annual Value (AAV) Method (Assumes straight-line depreciation). (2) Operation costs (hourly cost) (List the value of each factor) The following information is known: Purchase Price = $350,000 Cost of Dozer Tracks Price = $25,000 . Service Life = 5 years Utilization Anticipated per year = 2,000 hours Cost of Capital = 12% Residual Value = $70,000 Cost of Equipment Operator = $30/hr Cost of Fuel to Operate = 20 gallons per hour at $4/gallon Cost of Wear Items = 1,000 hours per set at $5,000 per set