Terotechnology and Lifecycle Cost

Running head: TEROTECHNOLOGY AND LIFECYCLE COST
Terotechnology and Lifecycle Cost
Name of the Student:
Name of the University:
Author’s Note:

1TEROTECHNOLOGY AND LIFECYCLE COST
Table of Contents
Answer to question 1: Report:.........................................................................................................2
Introduction:................................................................................................................................3
Concept of Terotechnology:........................................................................................................3
Concept of Asset Lifecycle costs:................................................................................................4
Company background and context to the case:...........................................................................4
Gaps verified in Lifecycle Costing:.............................................................................................5
Conclusion:..................................................................................................................................6
Answers to the practical questions:.................................................................................................7
Answer to question 2:......................................................................................................................8
Sub part (a):.................................................................................................................................8
Sub part (b):.................................................................................................................................8
Sub part (c):.................................................................................................................................9
Answer to question 3:......................................................................................................................9
Answer to question 4:....................................................................................................................10
Sub part 1:..................................................................................................................................10
Sub part 2:..................................................................................................................................10
Answer to question 5:....................................................................................................................11
References and bibliography:........................................................................................................12

2TEROTECHNOLOGY AND LIFECYCLE COST
Appendix:......................................................................................................................................13
Answer to question 1: Report:
Executive summary:
This report is aimed at explaining the concept of Terotechnology and the asset lifecycle costs.
Terotechnology is a term which is used in assets cost and benefits analysis. To develop an asset
some initial investment needs to be made and also some incidental expenses are incurred
subsequent to the development of an asset to make it usable and keep in running condition. In
this report all those expenses starting from the initial investment up to the dismantling cost of an
asset is analysed comparing the costs and benefits associated with such capital asset. The
Terotechnology and the asset lifecycle costs have been explained with the help of some practical
numerical as well qualitative information based on a company’s real data. Lastly, the report
outlines the initiative should be taken by a company for a successful investment in asset through
the use of Terotechnology and Asset lifecycle costing.

3TEROTECHNOLOGY AND LIFECYCLE COST
Introduction:
Every business organisation needs to make some investment in long term capital assets
for generating revenues for a longer period of time. Investment decision in long term capital
assets needs to be made consciously after conducting various investment evaluations and
analysis. Three are various methods of such investment analysis and appraisal. Every investment
opportunity has two aspects to be considered while making the investment decisions. One is the
revenue or the profitability aspect and the other is the expenses or the cost aspect. Every
investment should have a suitable return to its costs (Niazi 2014). There must be a balance
between the costs incurred in an investment and the benefits arising from it. Asset lifecycle cost
analysis ascertains all those costs which will be incurred starting from the initial stage till the
dismantling of the asset, and the Terotechnology makes balance between asset lifecycle costs and
the benefits. In the following parts of this report all those aspects have been explained based on
the data of selected company Scorpion Minerals Limited.
Concept of Terotechnology:
Every long term capital investment must be evaluated in terms of cost and benefits. The
term Terotechnology is such a term which is used in the investment analysis and project
appraisal. The concept of the term is to make valuation of future benefits arising from an
investment and costs needs to be incurred initially and in future. Its scope is very much wider
and covers the analysis for the whole life of the asset (Niazi 2014). To develop an asset which
will be generating revenues for a longer period of time in future, it needs some initial investment
and to make it remain usable and in running condition more expenses may have to be incurred in
future as repair and maintenance, erection, development and up gradation costs. Therefore, the
costs associated with an investment will be incurred throughout the life of the asset and the