Calculate annual cost from daily, weekly, monthly, quarterly or yearly expenses, or from purchase price, resale value and useful life.
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Cost Per Year Formula
The following equation is used to calculate the Cost Per Year.
CPY = ADC * 365
- Where CPY is the cost per year ($/year)
- ADC is the average daily cost ($)
To calculate the cost per year of a service or item, multiply the average daily cost by 365.
What is Cost Per Year?
Definition:
A cost per year is defined as the equivalent annual cost of a service or asset based on it’s average daily cost.
How to Calculate Cost Per Year?
Example Problem:
The following example outlines the steps and information needed to calculate Cost Per Year.
First, determine the average daily cost. In this example, we are looking at a service for streaming. The average daily cost of the streaming is found to be $5.00.
Next, determine the yearly cost using the formula above:
CPY = ADC * 365
CPY = 5*365
CPY = $1,825.00 / year
