Cost Engineering Assignment 2019/20
1. You are a cost engineering practitioner in large commercial organisation. Outline the range of duties you perform explaining the necessity your company has for you to perform them.
2. Categorise the following costs that are associated with a new project into the two categories of non-recurring and recurring:
• Design engineering
• Concept scheming
• Rivets used in product assembly
• Customer requested demonstrator units
• Component sub-assembly
• Spot welding
• CNC programming
• Machine shop holding fixtures
• Raw material
• Stress analysis
• Quality inspection
• Painting
• Mould tool
Give a brief explanation relating to your choice particularly if you believe a particular cost belongs in both categories.
3. Using either your own estimates in the workshop or the table below, prepare an analysis based on the split of labour and material costs and levels of material utilisation for each of the 4 components/manufacturing processes:
• Include brief explanations relating to your calculations;
• Show how this information could be used as the basis of both parametric analysis
and cost reduction activity.
Machined End Fitting
Machined Rib
Access Panel
Channel Stiffener
Material type
Stainless steel
Aluminium Alloy
Aluminium Alloy
Aluminium Alloy
Material form
Casting
Forged billet
Sheet + Bought-out
Sheet
Weight of material (kg)
1.00kg
53.47kg
1.99kg
6.55kg
Cost of material ($)
$35.50
58.1%
$331.50
63.3%
$58.35
43.3%
$68.76
31.7%
Finished weight
0.91kg
3.22kg
1.25kg
2.01kg
Material utilisation (%)
91.0%
6.0%
62.7%
30.8%
Process cost ($)
$25.58
41.9%
$191.82
36.7%
$76.47
56.7%
$148.28
68.3%
Total cost ($)
$61.08
100.0%
$523.32
100%
$134.82
100.0%
$217.04
100.0%
Cost per kg
$67.12
$162.52
$107.89
$107.72