To read this content please select one of the options below:

Plant and equipment acquisition: a life cycle costing case study

Jon Robinson (Jon Robinson is based at A.T. Cocks and Partners, Melbourne, Victoria, Australia)

Facilities

ISSN: 0263-2772

Article publication date: 1 May 1996

2616

Abstract

Uses a life cycle costing case study to describe a technique useful to facilities managers in a decision about the acquisition of plant and equipment. The case study investigates floor coverings in commercial buildings. Provides detailed financial calculations and incorporates a number of innovations. First, all the costs and benefits are included; life cycle costing is commonly promoted on a cost‐only basis, but all building expenditure generates a value effect and this must be measured in any meaningful study. Second, the choice of discount rate may be relieved by either sensitivity analysis or by the calculation of a “break‐even” discount rate; discusses these. The results show that vinyl is nearly 50 per cent more expensive than carpet and that the replacement of vinyl in an existing building with carpet has a payback of about three years.

Keywords

Citation

Robinson, J. (1996), "Plant and equipment acquisition: a life cycle costing case study", Facilities, Vol. 14 No. 5/6, pp. 21-25. https://doi.org/10.1108/02632779610117099

Publisher

:

MCB UP Ltd

Copyright © 1996, MCB UP Limited

Related articles