EP 1110-1-8
(Vol. 9)
31 July 03
a.
Repair Factor (RF). The repair factor is calculated as follows:
RF = RCF x EAF x LAF
Where:
(1) RCF (repair cost factor) is shown in appendix D. This factor varies
depending on the operating condition of the equipment (average or severe).
(2) EAF (economic adjustment factor) is used to adjust the RCF to current
price levels. The EAF is equal to the economic index for the present year divided by the
economic index for the year the equipment was manufactured. Indexes listed in
appendix E are used to develop the EAF. Economic indexes are determined as follows:
(a) Economic Index for the Present Year. Obtain the economic
index from appendix E. The index is located in the column with the present year and
the row with the type of equipment in question. If the column for the present year has
not been included, the index can be estimated using a straight-line projection.
(b) Economic Index for the Year of Manufacture. This is the
economic index for the year the equipment was manufactured (can be determined from
equipment serial numbers). Obtain the economic index from appendix E. The index is
located in the column with the year of manufacture and the row with the type of
equipment in question. If the actual age of the equipment is beyond the last year of its
economic life, the equipment is considered overage. Economic life is determined by
dividing hours of LIFE (from appendix D) by WHPY (appendix B). Refer to chapter 3 for
rate adjustments.
b. Items Included in the Repair Cost Factor. The estimated percentage
allowances for the RCF are shown in appendix D under the column heading RCF and
are expressed as decimal factors. These RCFs (for both the average and severe
conditions) compensate for the following cost elements:
(1) Mechanic's labor includes base wages, fringe benefits, supervision,
travel, and all other costs for labor associated with craft workers engaged in the direct
repair of equipment either in the field or the shop.
(2) Repair parts and supplies include those items that are required for all
repairs and major overhauls complete with applicable sales taxes and freight charges.
(3) Service trucks and other equipment used during field or shop repair
and maintenance work, including tools.
(4) Supporting repair facilities include field and main repair shops,
complete with parts and supplies inventory, and shop overhead.
2-10
Previous Page
