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this is general question not in any of the KIt, i just need the idea of how to approach this case
Aircraft company provide aircraft or any product of 5 years useful life for two company, the information provided for example, all commence before production
initial cost 6 M
research 6m
other 6 m
the company produced total 60 aircraft for all 5 Year period for both company W & R
Y1 Y2 Y3 Y4 Y5
W 6 12 12 4 4 38R 2 3 5 6 6 22
if the average Operation cost per aircraft is 14 M and fix cost 60
1- the question is how can we find the life cycle in this case
it it correct all cost (6+6+6+60+12)/60 is that correct ?2- if the plan has change for W instead of providing 12 in year 1 and year 2 the is now providing 6 in year2 and 6 year3 and the fixed cost increased by 2%
my question is for the average operation cost per craft? will it be changed or it doesn’t effect and 14 still valid?, Note : no other information regarding the average operation cost available .3- other question is that Aircraft provide annual service to maintain each aircraft all bought by R company per year for 100000$ in all their useful life and they can get marginal profit of 70 %
how we can calculate the profit from such a service ?Have you have been given this as an assignment (in which case you are surely not expecting us to do your homework for you), you must have an answer in the same book in which you found the question.
First of all:
How do we know with absolute certainty you have written it correctly.
Why do you think it is our responsibility to answer this for you?That being said to find the life cycle cost you need to calculate the total cost for each year and then sum them up. The total cost for each year can be calculated by adding the initial cost, research cost, other costs, and the fixed cost for that year. Then, divide the total cost by the total number of aircraft produced over the 5-year period.
So, I am presuming the life cycle cost would be (6 + 6 + 6 + 60 + 12) / 60 = 3.4 million dollars per aircraft.Over to you now…..
thank you so much could you please take it easy on me , i am not asking you to do my homework nor the calculation, i simply want the idea and the approach to this question.
i appreciate if you help me with number 2 and 3 as well!
let assume that that this what i have remembered from the exam which I’ve sit in on last Wednesday,
the number is may not actually correct, just want to know the idea because it made me so confused and i couldn’t come to solution, i am totally certain that i will have to set the exam again, appreciate little support here to make me through next time.
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