Profitability analysis rigorous

Chapters 16 and 17, on cost accounting and capital cost estimation, and profitability analysis, respectively, provide a comprehensive treatment of these subjects. Both approximate and rigorous methods are presented. Equations are provided for estimating the purchase cost of a... 

When carrying out a rigorous profitability analysis, some design teams adopt the convention of reducing the process yield by a small amount, such as 2%, to account for the loss of raw materials and products during startups, shutdowns, and periods when there are malfunctions. Often, raw materials are vented or flared during startup. In other cases, one part of the plant shuts down while the remainder continues to operate, with small amounts of intermediate products vented when they are nontoxic and not easily stored, until the idle portion of the plant is restarted. 

When a project is a profit-adding project, the economic analysis is usually much more rigorous. 

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