scholarly journals Cost Estimation Methods of Machine Elements at the Design Stage in Unit and Small Lot Production Conditions

2019 ◽  
Vol 27 (1) ◽  
pp. 12-17 ◽  
Author(s):  
Dorota Więcek ◽  
Dariusz Więcek ◽  
Ivan Kuric
Keyword(s):  
Cost Estimation ◽  
Group Technology ◽  
Hybrid Methods ◽  
Production Costs ◽  
Estimation Methods ◽  
Design Stage ◽  
Activity Based Costing ◽  
Machine Elements ◽  
Formalized Description ◽  
The Moment

AbstractOn the stage of product design there is a problem concerning production cost estimation in the moment when elements are not yet definitely designed. Depending on the amount of the available information, more or less precise cost estimation methods are applied, i.e.: variant methods, generation methods, hybrid methods. The proposed method of cost estimation is based on a formalized description of information related to construction, manufacturing and organizational characteristics concerning the designed element, the automation method of technological processes design using methods of group technology and a model of determining production costs of machine elements based on Activity Based Costing.

Manufacturing Feature Based Dynamic Cost Estimation for Design

2004 ◽  
Author(s):  
Harshal Patwardhan ◽  
Karthik Ramani
Keyword(s):  
Cost Estimation ◽  
Estimation Methods ◽  
Design Stage ◽  
Design Parameters ◽  
User Requirements ◽  
Geometric Information ◽  
Early Stages ◽  
Feature Based ◽  
The Cost ◽  
Manufacturing Feature

Due to the ever-increasing competition in today’s global markets, the cost of the product is rapidly emerging as one of the most crucial factors in deciding the success of the product. Decisions made during the design stage affect as much as 70–80% of the final product cost. Hence, a manufacturing cost estimation tool that can be used by the designer concurrently during the design phase will be of maximum benefit. A literature study of the available cost estimation tools suggests that a majority of these tools are meant for use in the later stages of the product development lifecycle. In the early stages of a product lifecycle, the only information that is available to the designer is related to geometry and material. Hence, the cost estimation methods that have been developed with the intent of being used in the early stages of design make use of the geometric information available at that stage of the design. Most of the earlier models that use parametric cost estimation and features technology consider the design features in their implementation. However, such models fail to consider “manufacturing based features” such as cores and undercuts. These manufacturing based features are very important in deciding the manufacturability and the cost of the part. The Engineering Cost Advisory System (ECAS) is a knowledge-based system that presents cost advice to the designer at the design stage after considering various design parameters and user requirements. Some of these design parameters can be extracted via standard Application Programming Interfaces (APIs). Moreover, ECAS uses innovative techniques of geometric reasoning and the hybrid B-rep-voxel model approach to extract manufacturing feature-based geometric information directly from the CAD input. By considering the manufacturing based features along with the design parameters, the ECAS architecture is applicable to a much wider variety of manufacturing processes. The complexity of the part, which is derived from the geometric parameters (manufacturing based and design based) and other non-geometric user requirements (e.g. quantity, material), is used to estimate the manufacturing effort involved in process specific activities. The final cost is then estimated based on this manufacturing effort and considering the hourly rates of labor and other contextual resources as well as material rates.

scholarly journals Assessing of Losses and Dilution Impact on the Cost Chain: Case Study of Gold Ore Deposits

2021 ◽  
Vol 13 (7) ◽  
pp. 3830
Author(s):  
Mikhail Marinin ◽  
Oksana Marinina ◽  
Radosław Wolniak
Keyword(s):  
Cost Estimation ◽  
Cost Savings ◽  
Efficient Solutions ◽  
Quality Parameters ◽  
Ore Deposits ◽  
Production Costs ◽  
Estimation Methods ◽  
Production Cycle ◽  
Production Chain

The conditions of declining gold grade in the ore, increasing depth of excavation, and de-creasing unallocated stock of deposits make it necessary to develop efficient solutions for the mine-to-mill process, which have to be adapted to each specific mining plant and will optimizes production costs. Current research focuses on a case study that demonstrates how indicators of mining losses and dilution influence the variation of costs chain in the production cycle. The article examines the topical issue of determining the effects at the mine-to-mill stages due to changes in losses and dilution. The author’s approach to the formation of a mine-to-mill cost chain is proposed by integrating several cost estimation methods into the general cost estimation methodology. The estimation methodology is a compilation of factor analysis and cost engineering methods that take into account the change in costs due to the variation of losses and dilution. It was proven that with variations in losses and dilution, cost savings arise due to changes in the volume of work on ore averaging, ore transportation, and beneficiation. For the case of the Kuranakh ore field, there are no effects at the mining stage. The use of internal reserves by means of managing ore quality parameters allows reducing the costs per ton of processed rock mass along the entire production chain.

scholarly journals Materials Requirement Planning with the Use of Activity Based Costing

2020 ◽  
Vol 28 (1) ◽  
pp. 3-8
Author(s):  
Dorota Więcek ◽  
Dariusz Więcek ◽  
Luboslav Dulina
Keyword(s):  
Point Of View ◽  
Production Costs ◽  
Design Stage ◽  
Activity Based Costing ◽  
Material Resources ◽  
Material Supply ◽  
Alternative Materials ◽  
Supply Costs ◽  
Effective Use ◽  
Materials Requirements Planning

AbstractOne of the rationalization areas is the material supply process. New tasks of material supply are: integration of supply with the operation of the entire system, especially at the product design stage, effective use of material resources, reduction of the level of supply costs from the point of view of production costs. In the conditions of unit and small batch production the materials requirement needs to be carefully planned and optimized due to the use of many different kinds, types and sizes of materials and dynamic changes of demand over time. In this situation there are needed tools enabling the measurement of production costs for particular tasks on the basis of currently realized processes. One of these tools is activity based costing which is a groundwork for decision making process in the material supply area. Basing on activity based costing, a model of materials requirements planning was developed, which considers minimizing the number of different kinds and sizes of materials by using alternative materials and, consequently, lowering production costs.

scholarly journals A case study on the application of activity based costing on the magnetic inductor

2021 ◽  
Vol 10 ◽  
pp. 195-205
Author(s):  
Nurul Farahin Zamrud ◽  
Sri Nur Areena Mohd Zaini ◽  
Mohd Yazid Abu
Keyword(s):  
Cost Accounting ◽  
Cost Driver ◽  
Production Costs ◽  
Activity Based Costing ◽  
Economic Reality ◽  
Abc Method ◽  
The 1960S ◽  
The Moment ◽  
The Cost

Speedy improvements in cost accounting since the 1960s have been noticed, particularly after the 1980s, in the percentage of total cost, overhead costs have increased. The problem of overhead allocation was faced by several companies and a disparity between the available methods of overhead allocation was developed. Because of skewed facts about the viability of their orders, goods and clients, traditional cost accounting (TCA) not anymore represents the actual economic reality. Consequently, in the moment of increasingly growing material liquidity and ambiguity, a new costing approach is needed to address the weakness of TCA. The goal of the study is to establish a new costing structure using activity based costing (ABC) method to the magnetic inductor for better precision. The case study is located at electronic industry in Pahang, Malaysia. ABC reports on the costs of manufacturing, selling or funding the goods used in the operations. The job was done correctly by the operator to accomplish the entire mission. The maximum time used by operators is at epoxy application activity which is 44.04% and the smallest is 0.64% at oven curing and boundary inspection activity. The highest amount of cost of capacity is epoxy application activity with MYR 1,665,600.00 and the quantity of material utilized is selected as the cost driver. Since the product required volume is up to 10%, production costs are expected to increase by MYR 4,160,614.85 while the unit product cost is forecast at MYR 0.79. Therefore, ABC is an cost management insightful process and cost control efficient approach.

Investigating the Relationship Between SLOC and Logical Database Measures to Improve the Early Estimation of Software Cost

2019 ◽  
Vol 29 (03) ◽  
pp. 401-413 ◽  
Author(s):  
Gul Tokdemir ◽  
Nergiz Ercil Cagiltay
Keyword(s):  
Cost Estimation ◽  
Primary Source ◽  
Database Design ◽  
Close Correlation ◽  
Project Planning ◽  
Estimation Methods ◽  
Design Stage ◽  
Size Estimation ◽  
Software Cost Estimation ◽  
Software Cost

Project planning is a critical activity in the software development life cycle. At the early stages of a project, the managers need to estimate required time, effort and cost to plan, track and then to deliver the project successfully. Many studies have attempted to provide methods for precise software cost estimation. The current software cost estimation methods are mainly based on software size estimation and functional system requirements. The main assumption of this study is that, as the primary source of complexity in today’s software is the interaction between the database and the user, database measures may provide inputs allowing current software estimation methods to achieve more accurate results. Accordingly, this study attempts to gain insights from objective measures, collected through the logical database model of software systems, for better prediction of the software’s effort and hence cost through software lines of code (SLOC) measure. For this purpose, more than 2.5 million lines of code developed by four different companies, for 79 different software packages with their related database design measures, are analyzed. The results of this study show that there is a close correlation between the software size and database design measure, namely, the number of tables which can be collected at the logical database design stage. By adapting this result, the current estimation models could be improved significantly.

Methology for Engineering Cost and Lead-Time Estimation in Metal Casting Applications

2002 ◽  
Author(s):  
Mileta M. Tomovic
Keyword(s):  
Cost Estimation ◽  
Lead Time ◽  
Time Estimation ◽  
Process Models ◽  
Estimation Methods ◽  
Design Stage ◽  
Accurate Estimation ◽  
General Process ◽  
Initial Cost ◽  
Engineering Cost

Accurate cost and lead-time estimation are very important issues during product design stage as well as for procurement process. The initial cost estimate can have profound effect on the project success or its failure. Inaccurate initial cost estimation can lead to financial losses that can have severe consequences on the project and company. Hence it is important to have accurate and easily accessible method for accurate cost and lead-time estimation. There are several estimation methods with focus on different manufacturing processes. These methods are based on general process description, and their process models and associated empirical data have limited accuracy. Also, most of them are not readily accessible to the engineers or procurement personnel. This paper presents application of one the more accurate estimation methods developed by the Air Force for metalcasting cost estimation. The method has been deployed on the Internet and can be easily accessed.

scholarly journals Deterministic and Probabilistic Engineering Cost Estimating Approaches for Complex Urban Drainage Infrastructure Capital Improvement (CIP) Programs

2018 ◽  
Author(s):  
Thewodros K. Geberemariam
Keyword(s):  
Cost Estimation ◽  
Estimation Methods ◽  
Design Stage ◽  
Cost Estimating ◽  
Project Cost ◽  
Cost Estimates ◽  
Contract Negotiations ◽  
Potential Risks ◽  
Good Resource ◽  
Engineering Cost

Accurate and reliable project cost estimates are fundamental to achieve successful municipal capital improvement (CIP) programs. Engineering cost estimates typically represent critical information for key decision makers to authorize and efficiently allocate the necessary funds for construction, budgeting, to generate a request for proposals, contract negotiations, scheduling, etc. for these reasons, cost estimators are using different estimating methods and approaches that allow for required levels of accuracy. As the project’s scope becomes more detailed and the potential risks are identified and/or the project design stage progresses these cost estimates are revised and updated. In this paper, the most common project cost estimation methods and approaches were collected and categorized into two main groups of (1) probabilistic and (2) deterministic methods. Under these groups overall ten different methods were identified and discussed addressing their requirements, advantages, and shortcomings, including the potential risk that can positively or negatively affect the project’s cost outcome. This paper will be a good resource for professionals who are in budget development and/or are seeking to a better understanding of different methods in determining an appropriate base cost margin and produce a meaningful and reliable project cost estimate.

An Activity-Based Costing Method for Product Family Design in the Early Stages of Development

2005 ◽  
Author(s):  
Jaeil Park ◽  
Timothy W. Simpson
Keyword(s):  
Cost Estimation ◽  
Production Cost ◽  
Product Family ◽  
Cost Effective ◽  
Production Costs ◽  
Activity Based Costing ◽  
Product Family Design ◽  
Product Families ◽  
Product Platforms ◽  
Activity Costs

As the marketplace is changing so rapidly, it becomes a key issue for companies to best meet customers’ diverse demands by providing a variety of products in a cost-effective and timely manner. In the meantime, an increasing variety of capability and functionality of products has made it more difficult for companies that develop only one product at a time to maintain competitive production costs and reclaim market share. By designing a product family based on a robust product platform, overall production cost can be more competitive than competitors selling one product at a time while delivering highly differentiated products. In order to design cost-effective product families and product platforms, we are developing a production cost estimation framework in which relevant costs are collected, estimated, and analyzed. Since the framework is quite broad, this paper is dedicated to refining the estimation framework in a practical way by developing an activity-based costing (ABC) system in which activity costs are mapped to individual parts in the product family, which is called cost modularization, and the activity costs affected by product family design decisions are reconstructed to make the costs relevant to these decisions. A case study involving a family of power tools is used to demonstrate the proposed use of the ABC system.

Catalog-Based Customization

1999 ◽  
Author(s):  
Bala Chidambaram ◽  
Alice M. Agogino
Keyword(s):  
Cost Function ◽  
Cost Estimation ◽  
A Priori ◽  
Production Costs ◽  
Estimation Methods ◽  
Optimization Formulation ◽  
Catalog Design ◽  
Standard Designs ◽  
Approximate Cost ◽  
The Cost

Abstract This paper develops a new method for implementing mass-customization, namely, the customization around standard products, or catalog-based customization. The method addresses the customization requirements of a class of products that are complex in configuration, multi-functional and structurally similar. We formulate catalog-based customization as an optimization problem consistent with the manufacturer’s goal of incurring minimal costs in the redesign of existing standard components, while meeting customer specifications and satisfying design constraints. The ‘catalog-based’ nature of the formulation raises concomitant issues of cost function development and problem simplification/solution. We identify the generational structure as best suited to exploit the cost data in existing catalogs and construct a product cost function. The cost-estimation methods used by the generational structure in the construction are identified as weight-based — for modeling the material costs, and methods based on similarity principles and regression analyses — for the production costs. The optimization formulation of catalog-based customization may be simplified by an a priori identification of a standard catalog design as the customization basis. This is accomplished with function costing — a cost-estimation hypothesis that uses product functionality to develop an approximate cost-estimate. The function-costing estimate is also used to abstract features from the standard base design into the optimization formulation. The preferred solution strategy for the optimization formulation is identified as genetic algorithms. We apply the customization method developed to Brushless D.C. Permanent Magnet (BDCPM) motors and obtain optimal minimal cost custom designs (from the standard designs of a BDCPM motor family) for different sets of customer requirements.

Biorefinery implementation for recovery debottlenecking at existing pulp mills- Part II: Techno-economic evaluation

TAPPI Journal ◽  
2012 ◽  
Vol 11 (8) ◽  
pp. 17-24 ◽  
Author(s):  
HAKIM GHEZZAZ ◽  
LUC PELLETIER ◽  
PAUL R. STUART
Keyword(s):  
Cost Estimation ◽  
Process Model ◽  
Black Liquor ◽  
Pulp Mill ◽  
Value Added ◽  
Economic Assessment ◽  
Extraction Process ◽  
Estimation Methods ◽  
Precipitation Process

The evaluation and process risk assessment of (a) lignin precipitation from black liquor, and (b) the near-neutral hemicellulose pre-extraction for recovery boiler debottlenecking in an existing pulp mill is presented in Part I of this paper, which was published in the July 2012 issue of TAPPI Journal. In Part II, the economic assessment of the two biorefinery process options is presented and interpreted. A mill process model was developed using WinGEMS software and used for calculating the mass and energy balances. Investment costs, operating costs, and profitability of the two biorefinery options have been calculated using standard cost estimation methods. The results show that the two biorefinery options are profitable for the case study mill and effective at process debottlenecking. The after-tax internal rate of return (IRR) of the lignin precipitation process option was estimated to be 95%, while that of the hemicellulose pre-extraction process option was 28%. Sensitivity analysis showed that the after tax-IRR of the lignin precipitation process remains higher than that of the hemicellulose pre-extraction process option, for all changes in the selected sensitivity parameters. If we consider the after-tax IRR, as well as capital cost, as selection criteria, the results show that for the case study mill, the lignin precipitation process is more promising than the near-neutral hemicellulose pre-extraction process. However, the comparison between the two biorefinery options should include long-term evaluation criteria. The potential of high value-added products that could be produced from lignin in the case of the lignin precipitation process, or from ethanol and acetic acid in the case of the hemicellulose pre-extraction process, should also be considered in the selection of the most promising process option.

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