Calculate an hourly cost for a pickup.

In this example, we are going to calculate the cost per hour of a Ford F150 4×4 6-cylinder truck.

Note that the reader must substitute the values used in this example to adapt them to the values in its area.

## Calculate an hourly cost for a pickup – Fixed cost formula

*Net value of equipment* **=** **Vn**

**Vn** = *Net value ***= Vad-P4-Pe**

Where:**Vad **is the acquisition value.

**P4** is the cost of replacement of 4 tires per year.

**Pe** is the value of special parts or accessories.

The following table shows the parameters used for the calculation.

## How to calculate the cost of the vehicle by the hour

For the calculation of the fixed costs of F150, we followed the concepts developed in the previous publications:**Cost of selected equipmentEquipment cost per hourLabor hours calculation**

## How to calculate the cost per hour of a pickup truck – Forms for use

### Resale value of machinery and vehicles

**Vrev** **=** The resale value of a vehicle after its useful life.

In the case of the F150, we deducted a resale value of 20% of the acquisition value.

### Depreciation

The value to be allocated to amortization is the result of the following formula:

**D= [Vn-Vrev/Vu]**

### Average interest on investment = **Im**

Average interest on investment at a yearly interest rate = Im.Â

The expense to be added to the cost of the equipment for the average interest of the investment is equal to:

The average equipment value of annual interest, divided into 2000 hours per year.

**Im = {[Vn + Vrev]/2 * 2000} *i**

### Cost of insurance, taxes and warehousing

Insurance, taxes, and annual storage fees are:

Cost of insurance: 5.5% of the average value of the material.

Cost for taxes: 1.5 per cent of the average value of the equipment.

The cost to storeÂ 1.5% to 2% of the average value of the equipment.

We get hourly costs by dividing the amounts by the number of annual working hours, 2000 hours.

### Maintenance and repair of machines

Maintenance for repair and spares costs.

We attribute the hourly maintenance cost for repairs and spare parts for the F150 truck a value equal to 50% of its depreciation value.

The formulas mentioned for the calculation of the fixed cost per hour of the F150 are presented in the table below.

The fixed cost per hour of the F150 truck in the example is 5.45 USD/hour.

In the next post, we will examine what are the **costs for consumption and operation.**

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Calculate an hourly cost for a pickup – Calculate Man Hours

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