Machining and Operating Cost of Each Product using Total Production Cost Calculator

Machining Cost Formula:

\[ C_{total} = TPC - (B \times C'_{avg} \times t_s + N_t \times ((C'_{avg} \times t_c) + C'_{avg})) \]

Total Production Cost:

Batch Size:

units

Average Cost of A Tool:

Setup Time:

sec

Number of Tools Used:

Time to Change One Tool:

sec

Machining and Operating Cost:

1. What is Machining and Operating Cost of Each Product?

Definition: This calculator determines the machining and operating cost per product by subtracting tool-related costs from the total production cost.

Purpose: It helps manufacturers understand the true cost of machining each component after accounting for tooling expenses.

2. How Does the Calculator Work?

The calculator uses the formula:

\[ C_{total} = TPC - (B \times C'_{avg} \times t_s + N_t \times ((C'_{avg} \times t_c) + C'_{avg})) \]

Where:

$ C_{total} $ — Machining and operating cost per product ($)
$ TPC $ — Total production cost ($)
$ B $ — Batch size (units)
$ C'_{avg} $ — Average cost of a tool ($)
$ t_s $ — Setup time per component (seconds)
$ N_t $ — Number of tools used
$ t_c $ — Time to change one tool (seconds)

Explanation: The formula subtracts tool-related costs (setup and change costs) from the total production cost to isolate the machining cost per product.

3. Importance of Accurate Cost Calculation

Details: Proper cost estimation ensures accurate pricing, profitability analysis, and cost control in manufacturing operations.

4. Using the Calculator

Tips: Enter all required values. Note that Number of Tools Used and Time to Change One Tool include a ±5% tolerance in their measurements.

5. Frequently Asked Questions (FAQ)

Q1: Why is there a ±5% tolerance on some inputs?
A: Tool change times and tool counts often vary slightly in real-world conditions, so we account for this potential variation.

Q2: How do I determine the average tool cost?
A: Average all tool costs used in the production process, including purchase price divided by expected lifespan.

Q3: What's included in total production cost?
A: TPC includes all costs: materials, labor, machine time, tools, overhead, etc. for the entire batch.

Q4: How does batch size affect the result?
A: Larger batches typically show lower per-unit machining costs as setup costs are spread over more units.

Q5: Can this be used for single-piece production?
A: Yes, just enter 1 for batch size, but note setup costs will be fully allocated to that single piece.