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Assignment No. 01 Milling Machine

IE 551 Engineering Economy

Mendoza, John Archie C. ME 5203

Engr. Gerald T. Aguila Instructor


Z Axis Travel: 406 mm Motor Power: 2 kW Spindle Speed: 50 - 3750 rpm

Table Size: 1473.2 x 279.4 mm X Axis Travel: 762 mm Y Axis Travel: 381 mm Z Axis Travel: 406 mm Motor Power: 4 hp = 2.984 kW Spindle Speed: 50 - 3,500 rpm

BRIDGEPORT BR2J2 MILLING MACHINE Cost: 2,350.00=P159,002.23 Physical Life: Replacement Period of 14 yrs Performance: Brand New Machine Type: VERTICAL Table Size: 1065 228 mm X Axis Travel: 675 mm Y Axis Travel: 305 mm BRIDGEPORT SERIES II VERTICAL MILL Cost: 2,100.00 = P142,493.85 Physical Life: Replacement Period of 10 yrs Performance: Machine Type: VERTICAL BOXFORD 190VMC VERTICAL MILL Cost: 14200 = P 97,405.26 Physical Life: 12 Years

Performance: 2nd Hand Machine Type: VERTICAL Table Size: 1200 X 280 mm

X Axis Travel: 620 mm Y Axis Travel: 260 mm Z Axis Travel: 400 mm

Motor Power: 2.2 kW Spindle Speed: 115-1750 rpm

Principles of Engineering Economy as applied in the selection of Milling Machine 1. Develop the Alternatives

a) The alternative 1 will be the brand new Bridgeport BR2J2 Milling machine which costs P159,002.23.
Based from the Manufacturer as he replied to the email it has a replacement period of 14 years which in engineering economy is define to be its physical life. And since it is in brand new condition, it will have less problems with regards to its performance. It has a buyers premium of 15% and Sales VAT of 20%.

b) The alternative 2 is also from Bridgeport, 11" x 58" Used Bridgeport, Mdl. Series II, 3 Axis Power
Feeds w/ Rapids, 2 axes DRO. It costs P142,493.85 and has a buyers premium of 15% and Sales VAT of 20%. With a physical life estimate of the manufacturer of about 10 years. It is a second hand machine that has been slightly used. The item may have some signs of cosmetic wear, but is fully operational and functions as intended.

c) The alternative 3 is the Boxford 190VMC Vertical Mill, which costs P 97,405.26 and a buyers
premium of 13.5% and sales VAT of 25%. It has a replacement period of roughly estimate 12 years due to its 2nd hand condition. With regards to its performance, it can also function as intended despite of being 2nd hand. 2. Focus on the Differences

a) Alternative 1 varies from the remaining two alternatives because first and foremost it is brand new.
It has a long physical life compare to the rest. With regards to the cost it is P 214653.0105 in total including the buyers premium and Sales VAT. This alternative has the highest spindle speed in a low motor power required.

b) Alternative 2 varies from alternative 1 from the fact that it is 2nd hand machine. It differs in from
Alternative 3 from its cost because the buyers premium and the Sales VAT are different making the total cost for Alternative 2 to be P192366.6975. With regards to its life and performance, it differs from the rest because it is on the least replacement period and requires a high motor power.

c) Alternative 3 is also 2nd hand the same as Alternative 2 but involves less cost of investment to the
machine. Its total cost with the buyers premium and Sales VAT is P134906.2851. With regards to its physical life it is on the middle of the two alternatives. In performance, the spindle speed is very low for a higher demand of motor power as compare to Alternative 1. 3. Use a Consistent Viewpoint The viewpoint taken here is that of an investor of a milling machine. 4. Use a Common Unit of Measure The costs of the milling machine define as alternatives are expressed in different currency, thats why they are all converted into Philippine Peso Currency to have a common unit of measure in terms of cost. A common unit of measure in terms of life is expressed in years. As to the performance the kW and rpm represents the common unit of measure motor power and spindle speed. Also the metric units of the table size and axes travel are included as the common unit of measure for obvious comparison. 5. Consider all Relevant Idea

a) Alternative 1 is eliminated, because alternative 2 has the almost the same Axes travel and spindle
speed with a less amount of cash to be spent. Even though it has a good performance the Alternative 2 can do almost the same. b) Alternative 2 would be a good alternative because it saves more money than that for Alternative 1 with almost the same performance. But it has a least physical life and it requires high motor power to do that performance which can be a lead to high expenses of repair and in electric energy consumption, which is why

c) Alternative 3 is the alternative accepted, because it has a very low cost of investment and will yield a low cost of expenses because it require a low motor power and has a longer life than that of Alternative 2. With regards to the performance it has a relative Axes travel same as the two alternatives and even though it has a low spindle speed it can be operated at full performance. 6. Make Uncertainty Explicit Among the uncertainties that can be found on these situation, the most relevant to the decision is a possibility that it would have a higher frequency of breakdowns because it is a 2nd hand machine, then the expenses for repair will arise and the operation is too slow because of the speed of spindle machine as compared to the two alternatives. 7. Revisit your Decisions The milling machine chosen for an investment is a satisfactory investment because of a low cost. The life can be prolong with the aid of repairs and the performance after being demonstrated turned out to be a good for machining. The systematic process of identifying and analyzing alternative solutions to this problem really help. References: