Determination of the appropriate replacement time for farm tractors using economic analysis :

Abstract

The present study was conducted to build up a module for the replacement of agricultural tractors. The objective of the replacement module was to identity the ideal length of time that a tractor should be kept before replacement. The formulation of the strategy adopted to implement the replacement module was based on economic analysis otherwise to develop repair and maintenance plan to keep up the unreplaced tractors. The data was collected from Farm Engineering Industries Limited Bunga yard Makindye division in Kampala. The model was developed using MS access package and Visual Basic package (version 2010) Based on the study in order to determine optimum life or economic life for MF385 at farm engineering industries limited, Repair and Maintenance costs, annual depreciation and Interest on investment in the study period were calculated. The total annual holding costs of the tractor were obtained and used to determine the economic life. Finally, replacement time for the study tractor 9391 hours was predicted. A maintenance schedule for unreplaced tractors is also provided so that the tractor can continue performing to its expectations. Proper performance in this case can lead to timely, high quality farm operations which in turns results in considerable decrease in product expenditures and also more income.