Cost revenue/operating

The objective function for the literature example is the maximization of profit, which is defined as the difference between revenue and operating cost. The operating cost consists of consumed external utility costs. 

Chapter 3 treats the most common type of objective function, the cost or revenue function. Historically, the majority of optimization applications have involved trade-offs between capital costs and operating costs. The nature of the trade-off depends on a number of assumptions such as the desired rate of return on investment, service life, depreciation method, and so on. While an objective function based on net present value is preferred for the purposes of optimization, discounted cash flow based on spreadsheet analysis can be employed as well. 

A database (historian) for process variables, costs and revenues, operating conditions, disturbances, and so on. 

The above objective represents a minimization of the annualized cost which comprises crude oil cost, refineries operating cost, refineries intermediate exchange piping cost, production system expansion cost, and export revenue. The operating cost of each process is assumed to be proportional to the process inlet flow and is expressed on a yearly basis. 

Improving or even innovating SCM design and operations is a reliable way to boost ROIC and therefore market value, as SCM links nearly all parts of a company s business system and can be a compelling force driving all factors of the ROIC equation cost, revenues, and capital. 

Denmark, Finland, Norway, and Sweden have been taxing carbon emissions since the 1990s. The results have varied with the tax collection methods. In Finland, Norway, and Sweden the carbon taxes had little impact on emissions, as industry just included them in its cost of operation while the governments treated these taxes as general revenue. In Denmark, the collected carbon taxes were invested in subsidizing the development of alternative energy technologies, and as a consequence the per capita emission by 2005 dropped below the 1990 level. 

In addition to investment costs, ongoing operational costs will divert your innovation s revenue stream. Use pro forma operations specs (Exhibit 11.4) to identify and estimate overhead costs. 

Thirteen other factors were also considered in evaluating each option (1) capital costs, (2) operating and maintenance costs, (3) liability cost rating, (4) timeliness, (5) transferability, (6) revenues, (7) equivalent annual costs, (8) pollution prevention mode, (9) net release reduction, (10) recovery costs, (11) cost effectiveness, (12) resource utilization, and (13) effects of secondary emissions. Finally, data Ifom public opinion polling in the community near the refinery were considered in evaluating potential public support or opposition to different pollution prevention strategies. 

Low and Sorenson (2003) presented the optimal design and operation of MultiVBD column. A profit function based on revenue, capital cost and operating cost was maximized while optimising the number of stages in different column sections, reflux ratio, etc. They compared the performance of MultiVBD with that of conventional batch distillation column for a number of different mixtures and claimed that MultiVBD operation is more profitable. However, for all cases considered in their work, the products specifications and amounts were not matched exactly and therefore the... 

Profitability is the difference of the revenue earned and the cost incurred. Revenue is obtained from the sale of product to the market (Ypi), treated waste to the market (Ytwi) and untreated waste to the neighboring plant (Yuwi)- Cost is incurred from the investment of the process and waste treatment unit as well as the cost of operation (i.e. cost of feed streams, cost of disposal of treated and untreated waste, cost of recycling treated and untreated waste). Profit, lEcP and lEvP for the IE with 6 plants are as follows ... 

Constant Dollar Analysis In the original problem statement, aU cash flows were presented in constant dollars. Thus, revenues, operating and maintenance expenses, and capital costs are straightforward. However, the loan principal and interest expenses tne actual doUar cash flows, which means they include the effects of inflation. Thus, these cash flows must be deflated with the inflation rate of 5%. These calculated cash flows, along with the other constant cash flows, are provided in Table 3. 

As a third category production-related performance measures reflect the monetary cashflow resulting from production operations. This includes costs for raw and auxiliary material consumption, labour costs of operators, opportunity costs for tied capital, and revenues due to sales of final and intermediate chemicals. A configuration of the network s logistical system affects the production system by providing prerequisites for normal production operations. I.e. a configuration assures that raw materials are available and that final and intermediate chemicals can be stored and delivered to customers. In this simulation study, these effects result in the availability or storability of intermediate chemicals. If material is unavailable or not storable (e.g. due to fully utilized. stock capacities), a disturbance of the production processes results such that plants have to reduce their production outcome or shut down. An appropriate measure to account for production disturbances is to measure the gap between planned and realized production for all plants associated to the considered... 

Table II - Summary of Mine Revenues (Excluding Mine and Smelter Costs) for Operation with Standard Technology... 

The net income statement is used to compute the annual net income or deficit of a project. The statement differs from the cash fbw schedule because it shows incomes and costs and not revenues and expenditures by period. The accrual concept is used in which income from operations is associated with the costs needed to produce the income during the same period. In financial analysis for feasibility studies, it is usually assumed that inventories are the same at the beginning and end of each year. The derivation of costs, revenues, and investments are shown in Figure 21.2. The income statement is related to the balance sheet statement as shown in Figure 21.3 such that the annual profit (or loss) increases (or reduces) the net worth of the company. The balance sheet statement shows the accumulated wealth of a company (assets) and how these assets are financed fliabilities). By definition both sides are equal. 

A basic plant flowsheet-linked economic model, which simulates the process and calculates both capital and operating cost/revenue impUcations of different process configurations, capacities, feedstock, product slate, etc. as may be required. Such models are commercially available for plants emplo5ung more standardized unit-processes built in high numbers, such as oil refineries, but can of course be built up for any plant. 

Industry Average Operating Margin Average C2C Cycle Average Inventory Turns Average SG A Cost/ Revenue... 

Unlike the cash flow from operations on an accountant s statement of cash flows that is found in an annual report, free cash flow is independent of financing and nonoperating items. If a company reports a significant gain or loss that is not directly related to the company s normal core business, such as a one-time gain on the sale of equipment, this amount should be excluded from the free cash flow calculation for an accurate picture of the company s normal cashgenerating ability. Thus, FCF depends on sales revenue, operating costs and taxes, and required investments in operations. 

The value of the concession is calculated on the basis of the expected profit stream (total revenue minus operating costs) and the operating ratio (total revenue/operating cost). The value of other potential contributions from developers/land owners in the form of cash payments could also be included here. 

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