Enter the total purchase price ($), the eventual salvage value ($), and the useful life span (hrs) into the Machinery Cost Per Hour Calculator. The calculator will evaluate and display the Machinery Cost Per Hour.

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## Machinery Cost Per Hour Formula

The following formula is used to calculate the Machinery Cost Per Hour.

MC = (P - SV) / LS

- Where MC is the Machinery Cost Per Hour ($/hr)
- P is the total purchase price ($)
- SV is the eventual salvage value ($)
- LS is the useful life span (hrs)

To calculate the machinery cost per hour, subtract the eventual salvage value from the purchase price, then multiply by the useful life span.

## How to Calculate Machinery Cost Per Hour?

The following example problems outline how to calculate Machinery Cost Per Hour.

**Example Problem #1**

- First, determine the total purchase price ($). The total purchase price ($) is given as 4,000 .
- Next, determine the eventual salvage value ($). The eventual salvage value ($) is calculated as 1,000 .
- Next, determine the useful life span (hrs). The useful life span (hrs) is found to be 1500.
- Finally, calculate the Machinery Cost Per Hour using the formula above:

MC = (P – SV) / LS

Inserting the values from above yields:

MC = (4000 – 1000) / 1500 = 2.00 ($/hr)

**Example Problem #2**

The variables needed for this problem are provided below:

total purchase price ($) = 60,000

eventual salvage value ($) = 10,000

useful life span (hrs) = 2000

Entering these values and solving gives:

MC = (P – SV) / LS = 25.00** **($/hr)