Capital, defined

Equation (F.l) shows that each stream makes a contribution to total heat transfer area defined only by its duty, position in the composite curves, and its h value. This contribution to area means also a contribution to capital cost. If, for example, a corrosive stream requires special materials of construction, it will have a greater contribution to capital cost than a similar noncorrosive stream. If only one cost law is to be used for a network comprising mixed materials of construction, the area contribution of streams requiring special materials must somehow increase. One way this may be done is by weighting the heat transfer coefficients to reflect the cost of the material the stream requires. 

The treatment of expenditures will be specified by the fiscal system set by the host government. A typical case would be to define expenditure on items whose useful life exceeds one year as capital expenditure (capex), such as costs of platforms, pipelines, wells. Items whose useful life is less than one year (e.g. chemicals, services, maintenance, overheads, insurance costs) would then be classed as operating expenditure (opex). 

The proflt-to-investmentratio (PIR) may be defined in many ways, and is most meaningful when deflated and discounted. On an undeflated and undiscounted basis, the PIR may be defined as the ratio of the cumulative cash surplus to the capital investment. This indicates the return on capital investment of the project, is simple to calculate, but does not reflect the timing of the income/investment in the project. 

The choice of a mass spectrometer to fulfill any particular task must take into account the nature of the substances to be examined, the degree of separation required for mixtures, the types of ion source and inlet systems, and the types of mass analyzer. Once these individual requirements have been defined, it is much easier to discriminate among the numerous commercial instruments that are available. Once suitable mass spectrometers have been identified, it is then often a case of balancing capital and running costs, reUability, ea.se of routine use, after-sales service, and manufacturer reputation. 

Cost Calculation. The main elements determining production cost are identical for fine chemicals and commodities (see Economic evaluation), a breakdown of production cost is given in Table 2. In multipurpose plants, where different fine chemicals occupying the equipment to different extents are produced during the year, a fair allocation of costs is a more difficult task. The allocation of the product-related costs, such as raw material and utiHties, is relatively easy. It is much more difficult to allocate for capital cost, labor, and maintenance. A simplistic approach is to define a daily rent by dividing the total yearly fixed cost of the plant by the number of production days. But that approach penalizes the simple products using only part of the equipment. 

Without proper control of hazards, a sequence of events (scenario) occurs which results ia an accident. A hazard is defined as anything which could result ia an accident, ie, an unplaimed sequence of events which results ia iajury or loss of life, damage to the environment, loss of capital equipment, or loss of production or inventory. 

In general the receptor nomenclature used is consistent with the recommendations of the various International Union of Pharmacology (lUPHAR) Committee on receptor nomenclature (19,20). In some cases the human receptor has been cloned. By convention, pharmacologicaUy defined receptors are shown ia capital letters cloaed receptors ia lower case letters. 

The fixed capital estimate depends on the definition of the plant. A grass-roots plant is a complete faciUty at a new location, including all utihties, services, storage faciUties, land, and improvements. If a process plant is located at an existing processing complex, it can usually share some of these auxihary faciUties. A battery-limits plant is defined as the process faciUty itself, so that the auxiUaries, off-site, and land-related items are excluded from the fixed capital estimation. However, a battery-limits plant maybe assigned allocated capital charges for the share of common utihty and service faciUties used by the plant. 

Possible numerators include the gross income net pretax income net after-tax income gross profit, ie, gross income minus book depreciation cash flow or net income. An average return value is selected by defining a typical or mature proof year as the basis of calculation. The denominator can be the original total investment, depreciated book-value investment, lifetime averaged investment, or fixed capital investment. 

Ca.ta.lysts, A catalyst has been defined as a substance that increases the rate at which a chemical reaction approaches equiHbrium without becoming permanently involved in the reaction (16). Thus a catalyst accelerates the kinetics of the reaction by lowering the reaction s activation energy (5), ie, by introducing a less difficult path for the reactants to foUow. Eor VOC oxidation, a catalyst decreases the temperature, or time required for oxidation, and hence also decreases the capital, maintenance, and operating costs of the system (see Catalysis). 

Capital ratio defined by Eq. (9-134) Capital-rate-of-return ratio defined by Eq. (9-56)... 

Since different meanings are ascribed to both annual profit and invested capital in Eq. (9-25), it is important to define the terms precisely. The invested capital may refer to the original total capital investment, the depreciated investment, the average investment, the current value of the investment, or something else. The annual profit may refer to the net annual profit before tax A vp, the net annual profit after tax Awp, the annual cash income before tax Aci, or the annual cash income after tax A vcf... 

Capitalized Cost A piece of equipment of fixed-capital cost Cpc will have a finite hfe of n years. The capitalized cost of the equipment Ck is defined by... 

As for the contribution efficiency T[, it is the ratio of (1) the annual profit that can actually be achieved in a given year for a given sales volume to (2) the profit that could be obtained if no repayment of capital or interest were required and all fixed-expense items were credited free to the project. It is defined by... 

Obviously, the net annual profit must be clearly defined before comparisons are made with other companies. Similarly the term investment in Eq. (9-128) can have a variety of meanings. The two most common ones (used when assessing the profitability of companies as opposed to projects) are total assets and owners equity or capital employed. In the first case, Eq. (9-128) can be written as... 

Clearly, (FATR) is of less value than (ATR) when applied to companies that use relatively large amounts of working capital. The (FATR) is the inverse of the capital ratio (CR) for single projects. (CR) is defined as... 

Total Capital Cost The installed cost of the fixed-capital investment Cpc is obviously an essential item which must be forecast before an investment decision can be made. It forms pai4 of the total capital investment Cfc, defined by Eq. (9-14). The fixed-capital investment is usually regarded as the capital needed to provide all the depreciable facihties. It is sometimes divided into two classes by defining battery limits and auxiliaiy facilities for the project. The boundary for batteiy limits includes all manufacturing equipment but excludes administrative offices, storage areas, utihties, and other essential and nonessential auxihaiy facilities. 

The first stage toward producing an accurate estimate is to use a standard cost code for all construction projects. Table 9-45 shows a suitable numerical cost code, and Table 9-46 shows a typical alphabetical-numerical code. The cost-code system can be used throughout the estimating and construction stages for the collection of cost data by manual or computer methods. There are numerous types of fixed-capital-cost estimates, but in 1958 the American Association of Cost Engineers defined five types as follows ... 

For convenience of notation we accept from here on, that each frequency of the problem co has a dimensionless counterpart denoted by a capital Greek letter, so that co,- = coofl,. The model (4.28) may be thought of as a particle in a one-dimensional cubic parabola potential coupled to the q vibration. The saddle-point coordinates, defined by dVjdQ = dVjdq = 0, are... 

This term is most familiar to people as the return on investment, or ROI. The ROI is defined as the interest rate that would result in a return on the invested capital equivalent to the project s return. For illustration, if we had an air abatement project where heat recovery was involved, and there was an overall ROI of 30 percent, that s financially equivalent to investing resources in the right stock and having its price go up 30 percent. This is called a Primitive ROI. ... 

The total capital investment of a process is defined as follows ... 

In addition to the fixed capital investment needed to purchase and install process equipment and auxiliaries, there is a continuous expenditure referred to as operating cost, which is needed to operate the process. The operating cost (or manufacturing cost or production cost) includes raw materials, mass-separating agents, utilities (fuel, electricity, steam, water, refrigerants, air, etc.), catalysts, additives, labor, and maintenance. The total annualized cost of a process is defined as follows ... 

The first phase is a clear definition of the scope of work that is to be performed during the shutdown or maintenance outage. This definition must be more than a macro-level listing of the major tasks that are to be performed. Instead, each of these major or macro-level tasks must be fully defined. The purpose of this procedure is to provide an effective method of planning, material control, and follow-up of repetitive, non-repetitive, and capital shutdown work. 

We shall often be dealing with sets of objects of some kind. A set, which we will label by capital letters A, B,. .is a collection of objects, denoted by lowercase letters a, b, , which are members (or elements) of the set. Finite sets may be defined by explicitly listing all of their members if the set A consists of the three elements a, b, c, for example, we would write A = a, b, c. We also write a A to mean that a belongs to the set A. Arbitrary sets may sometimes be more conveniently specified by some property V, which is shared by all of their members. For example, the set... 

There are different items that have warranties such as equipment, products, and materials. Fulfillment of warranties tends to be a two-way situation. As an example when one buys equipment, you are not just buying equipment, you are entering into a relationship. This may sound tripe, but it is demonstrably true in the case of capital equipment. The warranty relationship can be defined in writing by the warranty document. It goes into detail as to what the OEM (original equipment manufacturer) seller promises to do in event of equipment failure due to specific causes. It also details the responsibilities of the equipment owner. Sometimes the expectations of the processor and OEM are seriously mismatched. 

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