Total Machining and Operating Costs using Average Production Cost Solution

STEP 0: Pre-Calculation Summary
Formula Used
Total Machining And Operating Cost = (Production Cost of Each Component-(Cost of a Tool*Non-Productive Time)-((Number of Tools Used/Batch Size)*(Cost of a Tool*Time to Change One Tool+Cost of a Tool)))*Batch Size
Cm = (Cpr-(Ct*NPT)-((Nt/Nb)*(Ct*tc+Ct)))*Nb
This formula uses 7 Variables
Variables Used
Total Machining And Operating Cost - Total Machining And Operating Cost is the total amount of money required to machine a given batch of product.
Production Cost of Each Component - Production Cost of Each Component is the total amount that it takes to produce a single component from scratch.
Cost of a Tool - The Cost of a Tool is simply the cost of one tool being used for machining.
Non-Productive Time - (Measured in Second) - Non-Productive Time is the total time wasted in setting up the machine or workpiece for a particular process.
Number of Tools Used - The Number of Tools Used is the total number of tools used for manufacturing a batch of products.
Batch Size - Batch Size is the count of similar kinds of products to be manufactured.
Time to Change One Tool - (Measured in Second) - Time to Change One Tool is the measure of time it takes to change one tool during machining.
STEP 1: Convert Input(s) to Base Unit
Production Cost of Each Component: 15000 --> No Conversion Required
Cost of a Tool: 80 --> No Conversion Required
Non-Productive Time: 0.8 Minute --> 48 Second (Check conversion here)
Number of Tools Used: 3 --> No Conversion Required
Batch Size: 2 --> No Conversion Required
Time to Change One Tool: 0.5 Minute --> 30 Second (Check conversion here)
STEP 2: Evaluate Formula
Substituting Input Values in Formula
Cm = (Cpr-(Ct*NPT)-((Nt/Nb)*(Ct*tc+Ct)))*Nb --> (15000-(80*48)-((3/2)*(80*30+80)))*2
Evaluating ... ...
Cm = 14880
STEP 3: Convert Result to Output's Unit
14880 --> No Conversion Required
FINAL ANSWER
14880 <-- Total Machining And Operating Cost
(Calculation completed in 00.004 seconds)

Credits

Created by Kumar Siddhant
Indian Institute of Information Technology, Design and Manufacturing (IIITDM), Jabalpur
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Verified by Parul Keshav
National Institute of Technology (NIT), Srinagar
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6 Machining And Operating Cost Calculators

Total Machining and Operating Costs using Average Production Cost
Go Total Machining And Operating Cost = (Production Cost of Each Component-(Cost of a Tool*Non-Productive Time)-((Number of Tools Used/Batch Size)*(Cost of a Tool*Time to Change One Tool+Cost of a Tool)))*Batch Size
Machining and Operating Cost of Each Product using Average Production Cost
Go Machining and Operating Cost of Each Product = Production Cost of Each Component-(Cost of a Tool*Setup Time+(Number of Tools Used/Batch Size)*((Cost of a Tool*Time to Change One Tool) +Cost of a Tool))
Machining and Operating Cost of Each Product using Total Production Cost
Go Machining and Operating Cost of Each Product = Total Production Cost-(Batch Size*Cost of a Tool*Setup Time+Number of Tools Used*((Cost of a Tool*Time to Change One Tool)+Cost of a Tool))
Machining and Operating Cost of Each Product using Individual Cost
Go Machining and Operating Cost of Each Product = (Total Production Cost-(Total Non-Productive Cost+Total Tool Changing Cost+Total Cost of Tools Used))/Batch Size
Total Machining and Operating Costs given Individual Costs
Go Total Machining And Operating Cost = Total Production Cost-(Total Non-Productive Cost+Total Tool Changing Cost+Total Cost of Tools Used)
Total Machining and Operating Costs given Total Production Cost
Go Total Machining And Operating Cost = Total Production Cost-(Total Cost of Tools Used+Total Tool Changing Cost+Total Non-Productive Cost)

Total Machining and Operating Costs using Average Production Cost Formula

Total Machining And Operating Cost = (Production Cost of Each Component-(Cost of a Tool*Non-Productive Time)-((Number of Tools Used/Batch Size)*(Cost of a Tool*Time to Change One Tool+Cost of a Tool)))*Batch Size
Cm = (Cpr-(Ct*NPT)-((Nt/Nb)*(Ct*tc+Ct)))*Nb

Significance of Machining and Operating Costs

The Machining and Operating Cost basically helps in determining the count of components that can be manufactured in the given resources. If this calculated cost is lower than the actual cost based on machining time, it means that the production planning has failed, as the total number of the components that are to be produced becomes lower than the starting batch size.

How to Calculate Total Machining and Operating Costs using Average Production Cost?

Total Machining and Operating Costs using Average Production Cost calculator uses Total Machining And Operating Cost = (Production Cost of Each Component-(Cost of a Tool*Non-Productive Time)-((Number of Tools Used/Batch Size)*(Cost of a Tool*Time to Change One Tool+Cost of a Tool)))*Batch Size to calculate the Total Machining And Operating Cost, The Total Machining and Operating Costs using Average Production Cost is a method to determine the capital that must be invested for machining and operating processes to be afforded for a whole batch when based on the expense it took to manufacture a single component. Total Machining And Operating Cost is denoted by Cm symbol.

How to calculate Total Machining and Operating Costs using Average Production Cost using this online calculator? To use this online calculator for Total Machining and Operating Costs using Average Production Cost, enter Production Cost of Each Component (Cpr), Cost of a Tool (Ct), Non-Productive Time (NPT), Number of Tools Used (Nt), Batch Size (Nb) & Time to Change One Tool (tc) and hit the calculate button. Here is how the Total Machining and Operating Costs using Average Production Cost calculation can be explained with given input values -> 14880 = (15000-(80*48)-((3/2)*(80*30+80)))*2.

FAQ

What is Total Machining and Operating Costs using Average Production Cost?
The Total Machining and Operating Costs using Average Production Cost is a method to determine the capital that must be invested for machining and operating processes to be afforded for a whole batch when based on the expense it took to manufacture a single component and is represented as Cm = (Cpr-(Ct*NPT)-((Nt/Nb)*(Ct*tc+Ct)))*Nb or Total Machining And Operating Cost = (Production Cost of Each Component-(Cost of a Tool*Non-Productive Time)-((Number of Tools Used/Batch Size)*(Cost of a Tool*Time to Change One Tool+Cost of a Tool)))*Batch Size. Production Cost of Each Component is the total amount that it takes to produce a single component from scratch, The Cost of a Tool is simply the cost of one tool being used for machining, Non-Productive Time is the total time wasted in setting up the machine or workpiece for a particular process, The Number of Tools Used is the total number of tools used for manufacturing a batch of products, Batch Size is the count of similar kinds of products to be manufactured & Time to Change One Tool is the measure of time it takes to change one tool during machining.
How to calculate Total Machining and Operating Costs using Average Production Cost?
The Total Machining and Operating Costs using Average Production Cost is a method to determine the capital that must be invested for machining and operating processes to be afforded for a whole batch when based on the expense it took to manufacture a single component is calculated using Total Machining And Operating Cost = (Production Cost of Each Component-(Cost of a Tool*Non-Productive Time)-((Number of Tools Used/Batch Size)*(Cost of a Tool*Time to Change One Tool+Cost of a Tool)))*Batch Size. To calculate Total Machining and Operating Costs using Average Production Cost, you need Production Cost of Each Component (Cpr), Cost of a Tool (Ct), Non-Productive Time (NPT), Number of Tools Used (Nt), Batch Size (Nb) & Time to Change One Tool (tc). With our tool, you need to enter the respective value for Production Cost of Each Component, Cost of a Tool, Non-Productive Time, Number of Tools Used, Batch Size & Time to Change One Tool and hit the calculate button. You can also select the units (if any) for Input(s) and the Output as well.
How many ways are there to calculate Total Machining And Operating Cost?
In this formula, Total Machining And Operating Cost uses Production Cost of Each Component, Cost of a Tool, Non-Productive Time, Number of Tools Used, Batch Size & Time to Change One Tool. We can use 2 other way(s) to calculate the same, which is/are as follows -
  • Total Machining And Operating Cost = Total Production Cost-(Total Non-Productive Cost+Total Tool Changing Cost+Total Cost of Tools Used)
  • Total Machining And Operating Cost = Total Production Cost-(Total Cost of Tools Used+Total Tool Changing Cost+Total Non-Productive Cost)
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