Manufacturing-cost estimation costs

E. M. Malstrom, What Evey Engineer Should Knoiv About Manufacturing Cost Estimating Marcel Dekker, New York, 1981. 

Budgeted income statements are identical in form to ac tual income statements. However, the budgeted numbers are objectives rather than achievements. Budgetary models based on mathematical equations are increasingly being used. These may be used to determine rapidly the effect of changes in variables. Variance analysis is discussed in the treatment of manufacturing-cost estimation. 

Indirect Manufacturing Costs Estimates for the cost of payroh overhead, control laboratoiy, general plant overhead, packaging, and storage facilities are best based on company records for similar processes. 

Rapid Manufacturing-Cost Estimates Fixed manufacturing costs are a func tion of the fixed-capital investment and are independent of the production rate of the plant. Property taxes or rates depend on location. They may be taken as 2 percent of the fixed-capital cost of the plant in the absence of specific data. The cost of insurance depends on both location and the hazardous nature of the materials handled. This cost is normally of the order of 1 percent of the fixed-capital cost of the plant. 

Jenckes, L.C. Developing and Evaluating a Manufacturing Cost Estimate, Chemical Engineering, Jan. 11, 1971, p. 168. 

Manufacturing Costs. Manufacturing costs for alkylamines depend on the specific amine and the process. Reference 116 gives the estimated production costs for two different processes. 

Schreve, K., Schuster, H. R. and Basson, A. H. (1998) Manufacturing cost estimation during design of fabricated parts. Proc. EDC 98, Brunei University, UK, July, 437-444. 

Lomax, Jr., F. D., B. D. James, G. N. Baum, and C. E. Thomas, Detailed Manufacturing Cost Estimates for Polymer Electrolyte Membrane (PEM) Fuel Cells for Light Duty Vehicles, Directed Technologies, Report to U.S. DOE, Contract No. DE-AC02-94CE50389, 1998. 

In the laboratory or process research section a laboratory procedure for a fine chemical is worked out. The resulting process description provides the necessary data for the determination of preliminary product specifications, the manufacture of semicommercial quantities in the pilot plant, the assessment of the ecological impact, an estimation of the manufacturing cost in an industrial-scale plant, and the vaHdation of the process and determination of raw material specifications. 

Although synthetic lubrication oil production amounts to only about 2% of the total market, volume has been increasing rapidly (67). Growth rates of the order of 20% per year for poly( a-olefin)s, 10% for polybutenes, and 8% for esters (28) reflect increasing automotive use and these increases would accelerate if synthetics were adopted for factory fill of engines by automotive manufacturers. The estimated production of poly( a-olefin)s for lubricants appears to be approximately 100,000 m /yr, esters 75,000, poly(alkylene glycol)s 42,000, polybutenes 38,000, phosphates 20,000, and dialkyl benzene 18,000 (28,67). The higher costs reflected in Table 18 (18,28) have restricted the volume of siUcones, chlorotrifluoroethylene, perfluoroalkylpolyethers, and polyphenyl ethers. 

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