ME-602-DRAWING ESTIMATING AND COSTING

VI - SEMESTER MECH ENGG

PREPARED BY,
MD TAYAB ALI
Sr Grade Lecturer
Department OF Mechanical Engineering
H.R.H. The Prince of Wales Institute of Engineering &
Technology, Jorhat-785001
Assam
Slide 1
 THEORY SESSIONAL

TEACHERS ASSESSMENT HOME ASSIGNMENT

(10 MARKS) (20 MARKS)
ATTENDANCE CLASS HOME POSTER QUESTIONNAIRES
(5 MARKS) PARTICIPATION ASSIGNMENT PRESENTATION SURPRISE
GROUP (5 MARKS) (3 MARKS) QUIZZES
DISCUSSION CLASS TEST
& (12 MARKS)
DISCIPLINE
(5 MARKS)

Slide 2
 Course Outcome
 After learning this subject, the students should be able to:
 1. Draw Jigs and Fixtures.
 2. Know the fundamentals of estimating and costing.
 3. Estimate the cost of production of machine or engine components.
 4. Calculate the depreciation cost of a machine.
 5. Estimate the machining, sheet metal ,Fabricating and welding time of a
final/simple product.
 6. Draw the assembly drawing using part drawings so that students will be
able to produce the final product by procuring the units from various
sources/suppliers .

Slide 3
 A
Presentation On

Introduction to Estimation
Presented by

Md Tayab Ali
Sr Grade Lecturer
Dept. of Mechanical Engineering
H.R.H. The POWIET, Jorhat

Copyright © 2007 Pearson Education, Inc Publishing as Pearson Addison-Wesley.

Slide 4
 Introduction to Estimation

Lesson Objectives: On completion of this lesson, the

students will be able to:
Define estimation.
Explain the importance of estimation.
List the aims of estimation.
Understand the constituents of Estimation.

Slide 5
 Estimation

Estimation:-Cost estimating may be defined as the process

of determining the probable cost of the product before the start of
manufacture.
Features of estimation
Important activity in engineering design and production
It is forecasting the future cost
Cost estimating & process planning are prominent activities in the
manufacturing system
It considers all the expenditures involved like engineering,
administration, etc
It requires high technical knowledge Slide 6
 Purpose of cost estimation

 The purpose of cost estimating is to find the

cost of the manufacturing operations and to
assist in setting the price for the product.

Slide 7
 Importance of estimation

The only accurate estimating can enable the leaders

to make vital decisions such as manufacturing,
selling policies
Case – 1 if job is over estimated,
-The firm will not be able to compete with its
competitors
Case – 2 if the job is under estimated,
-The firm will face huge financial loss

Slide 8
 Aims of estimation

1. To establish the selling price of a product, so as to

ensure reasonable profit to the company

2. To determine the most economical process

3. To make/buy decisions

4. To evaluate the alternate designs

5. To prepare production budget

6. To initiate the cost reduction in existing facilities

Slide 9
 Constituents of Estimation

Following are the constituents of estimation:

1. Design cost
2. Drafting cost
3.Planning and production cost.
4. Cost of experimental work.
5. Labour cost
6. Material cost
7. Inspection cost
8.Procurement of special tools and equipment
9. Time allowances
10. Overheads.
11. Profit
Slide 10
 1.Design cost

Design cost of the product is estimated by ascertaining

the expected time for the design of that product
Estimated Design cost = Estimated design time x
salary of the designer per unit time

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 2.Drafting cost

When the design completed, the drawing will be

prepared by the draftsman.
Drafting cost = Estimated draft time x salary of
the draftsman per unit time

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 3.Planning and production cost.

Sufficient time may be consumed for such

activities and, therefore, an estimated time and
the costs to be incurred on it are decided by
past experience or judgement.

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 4. Cost of experimental work.

 Experimental work may be carried out in order to find out

the best and cheapest method of manufacturing a
product.
 The cost incurred on such activities is given due
consideration.
 The cost of experimental research work includes-cost of
special equipment and trained personnel, cost of
material, labour and overheads.

Slide 14
 5.Labour cost
Following steps involved
To estimate the labour cost, the estimator should have
the knowledge of various operations, machines,
sequence, tools & labour to be used.
Different allowances like personal, fatigue, tool
changing and grinding and checking measurement
allowances should also be taken into consideration.
Labour cost = Estimated labour time needed to the
product x Cost of the labour per hour

Slide 15
 6.Material cost
Following steps involved
Prepare the list of all materials required to
manufacture the product
Estimate the weight of all the materials expected (the
allowance for the material wastage, spoilage and scrap
are also added)
Estimated materials cost = Estimated weight of each
part x Estimated future price
Finally, the estimated cost of all the parts is added to
get the total estimated material cost of the product.
Slide 16
 7. Inspection cost

During this stage, the estimator should consider the

cost of inspection equipments, gauges and wages to
the inspectors

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8.Procurement of special tools and equipment

Special and tools and equipment may include special

cutting tools, jigs, fixtures, dies, patterns, moulds or a
special purpose machine.
The time and cost required to manufacture or procure
such items has to be distributed over the number of
products being made.
Total cost per unit produced = Estimated cost/No of
jobs

Slide 18
 9.Time allowances

Time allowances are:

(i) Set up time
(ii) Operation time – (a)Handling time (b)Machine time
(iii) The tear down time
(iv) Miscellananeous allowances:(10-15% of total time)
(a)Personal allowances(b)Fatigue allowances (c)Tool
changing and grinding allowances (d)Measurement
checking allowances(e)Other allowances

Slide 19
 9.Time allowances

Set up time: Time required for setting and

fixing the job and different tools on the
machine.
 Operation time–
(a)Handling time (b)Machining time
Handling time means all the time required in
physical movements while performing the
machining operations.
Machining time:- Machining time means time
taken by the machines from the start when the
tool touches the job to the end when the tool
leaves the job.
Slide 20
 9.Time allowances

Tear-down time: This time is counted from when the last

element of operation has been completed.
Miscellaneous allowances:
Personal allowances – It is the time allowed to a worker
to attend to his personal needs such as going to lavatories,
to take water or tea, to smoke etc. This allowance is about
5% of the total working time.
Fatigue allowances: Fatigue results due to excessive
physical and mental labour. This allowance is about 5% of
Slide 21
the total working time.
 9.Time allowances

Tool changing and grinding allowances:

 These include the time required to remove the tool from
its holder and to fix another tool in its place.
 Or the tool will be taken to the grinder, sharpened,
installed back in its holder and adjusted.
 These allowance may be taken nearly 5-10% of the total
time.
 Measurement checking allowances:
 These include the time taken on measuring and checking
the different dimensions of the product.
 This allowance may be taken as nearly 2 to 3% of the
total time.

Slide 22
 9.Time allowances

Other allowances:
 Allowances in time should be provided for the following
activities also:
 Periodic cleaning and oiling of machines
 Getting stocks
 Delivering jobs
 Disposing of scraps and surplus stock etc.

Slide 23
 10.Overhead cost

This cannot be charged directly to a particular product

during production.
All expenses other than direct cost are known as
overhead cost or Indirect expenses,
Example:- Indirect material cost, Indirect labour cost
Administrative overheads, selling and distribution
overheads, etc.

Slide 24
 11.Profit

Profit is a measure of the overall efficiency of a business

Slide 25
Thank You

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