TABLE 9.--ESTIMATED REPLACEMENT AND FIXED COSTS OF EQUIPMENT FOR TRANSPORTING
 AND LOADING 100- AND 50-POUND BURLAP BAGS OF POTATOES BY SELECTED
 METHODS AT VARYING RATES OF OUTPUT


 Low Output Rate High Output Rate

 Replace- Annual Replace- Annual
 Item ment Fixed ment Fixed
 Cost Cost cost Cost


 Hand Truck Method

 Hand trucks $ 270 $ 45 $ 546 $ 89

 Conveyor System

 Conveyor system $2946 $ 485 $5880 $ 970
 Built-up floor 100 12 200 23
 Total $3040 $ 497 $6080 $ 993

 Fork Truck Method

 Fork truck a $ 500 a $ 900
 Pallets $ 150 40 $ 300 80
 Total $ 540 $ 980


 aThe fork truck would be rented for the
assuming that it would be kept for two months.


indicated annual costs,


 Total labor and equipment costs for all three methods are shown in

Table 10. At lower volume levels the hand truck method has lower costs

because of low fixed costs. As volume increases, cost differences decrease

until, at a volume of about 34,000 hundredweights (at the low output rate),

costs for the two methods are equal. For the high output rate, this point

is reached at about 78,000 hundredweights. Beyond these points costs are

lower for the conveyor method. The fork truck method has higher costs at

all volume levels.