Cost items | Operational definition | Cost |
---|---|---|
Direct costs | ||
Labor | Cost × Quantity ÷ (1- idle time%) × T* | Cost/min: nurse 5.49; clerk 4.68; Idle time: 20%; T = activity time ÷ working time |
Material | Cost × Quantity | |
Depreciation | ||
Buildings/construction | Cost of building ÷ depreciation life × T | Cost of building/m2 = 21,749 Depreciation life = 50 yrs |
Machinery/equipment | Cost ÷ Depreciation life × T | |
Repair and maintenance | ||
Buildings/construction | Cost of building repair × area × T | Repair cost of building/m2 = $59.14 (cash billing area = 18.5 m2; smartcard area = 13.8 m2) |
Machinery/equipment | Cost × equipment repair% × T | Equipment repair% = 2.42% |
Indirect costs | ||
Service | Direct cost ÷ (1-Service%) × Service% × T | Service% = 11.23% |
Administration | (Direct cost + Service costs) × Administration% × T | Administration% = 3.58% |
Research & training | (Direct cost + Service costs) × R&T% × T | R&T% = 2.36% |
Other costs | ||
Patent royalty | Amount × 1.5% | |
Business tax | Amount × 0.05% |