Question Bank • QB_FM_051 NAT • 2 Marks

Section 2: Farm Machinery

Farm Machinery

Subtopic: Cost analysis of implements and tractors

Question Statement:

A 40 kW farm tractor operates 800 hours annually. Its total annual fixed costs (depreciation, interest, insurance, housing) are $\text{Rs. } 1,20,000$. The fuel consumption is $6.0\text{ L/h}$ at $\text{Rs. } 90\text{ per liter}$. Lubricants cost $15\%$ of fuel cost. Annual repair and maintenance costs are $\text{Rs. } 48,000$. Operator wages are $\text{Rs. } 100\text{ per hour}$. The total operating cost per hour in $\text{Rs./h}$ is ________ (round off to 1 decimal place).

Answer Key:

931.0

Step-by-Step Solution & Explanation

1. Hourly fixed cost: $FC_h = \frac{1,20,000}{800} = \text{Rs. } 150.0/\text{h}$ 2. Fuel cost per hour: $\text{Fuel} = 6.0 \times 90 = \text{Rs. } 540.0/\text{h}$ 3. Lubricant cost per hour: $\text{Lube} = 0.15 \times 540 = \text{Rs. } 81.0/\text{h}$ 4. Repair and maintenance per hour: $R\&M_h = \frac{48,000}{800} = \text{Rs. } 60.0/\text{h}$ 5. Operator labor cost per hour: $\text{Labor} = \text{Rs. } 100.0/\text{h}$ 6. Total hourly cost: $\text{Total Cost} = 150.0 + 540.0 + 81.0 + 60.0 + 100.0 = \text{Rs. } 931.0/\text{h}$
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