10.

1 Engineering drawings and its concepts : Fundamentals of standard

drawing sheets, dimensions, scale, line diagram, orthographic projection,
isometric projection/view, pictorial views, and sectional drawing.
1. Good for construction drawing (GFC):
a. Issued to the site for construction
b. They are the final construction with specifications
c. They are approved by local agencies and clients
2. Contract drawing
a. Proposal drawing issued to the bidders and issued to the contractor during
construction
3. As-built drawing:
a. They are revised drawing created and submitted by a contractor after a construction
project is finished
4. Tender stage drawing:
a. Issued to the contractor as a part of the tender document
5. Engineering drawing:
a. Type of technical drawing that is used to convey information about an object
6. Minimum width: 20mm for A0 and A1 and 10mm for A2 A3 A4
7. When the eccentricity of the conic section is equal to 1 – the resulting curve is parabola.
8. The recommended dimensioning a sphere with diameter 80mm is S*phi*80
9. Engineering Scale designation indicates:
a. M1 =1:1 (one edge) 1:2 (in another edge)
b. M2=1:2.5
c. M3=1:10
d. M4=1:50
e. M5=1:200
f. M6=1:300
g. M7=1:400
h. M8=1:1000
10. The length of the arrow head =3:1 (length: width)
11. Standard size of the drawing board of different designation
a. D0 =1500x1000x25 =A0
b. D1=1000x700x25=A1
c. D2=700x500x15
d. D3=500x350x15
12. Size of the drawing sheet
a. A0=841 x 1189
b. A1=594 x 841
c. A2=420x594
d. A3=297x420
e. A4=210x297
f. A5=148x210
13. Title block in drawing sheet:
a. Size: 185mm x 65mm and placed at the right hand bottom corner of the sheet.
14. Types of assembly drawing
a. Design assembly: drawing made at the time of design stage on a large scale
b. Layout assembly: shows how the part to be assembly with their basic proportions
c. Installation drawing- shows how to install or erect a machine or structure
 d. Working assembly: necessary information for the production of the individual parts and
assembly
e. General assembly: detail drawing of the individual part, sum assembly and assembly
drawing of the machine
15. The internal angle of regular pentagon is 108
16. Sum of interior angle (n-2)x180
17. Each angle of different shape = sum of interior angle /2
18. Isometric view drawing:
a. All the three axes are 120 degree apart
b. Horizontal lines are 30 degree to horizontal plane where are vertical line remain vertical
19. Oblique projection:
a. The object is aligned such that one face is parallel to the projection plane
b. The projectors are not perpendicular to the plane of projection rather inclined to the
plane of projection at 30, 45 and 60 degree
20. A cylinder can be created by drawing a rectangular shape and then revolve tool
21. In order to convert inches of fractional into decimal – divide the numerator and denominator
22. In CAD, fonts number =2
23. Offset tool is used only on = vertical lines
24. The first steps in traditional technical drawing is to – align the paper so that it will be positioned
square to the parallel bar
25. The default position of UCS icon is positioned at 0,0,0 on the auto CAD grid
10.2 Engineering Economics: understanding of project cash flow; discount
rate, interest and time value of money; basic methodologies for engineering
economics analysis (Discounted Payback Period, NPV, IRR & MARR);
comparison of alternatives, depreciation system and taxation system in
Nepal
1. Sole partnership- a person conducts his business alone and entirely for his own profit
2. Depreciation is given by:
a. Diminishing balance method (DBM): Dm=[Cost of an assets (Ci)*rate
of depreciation]/100
b. (straight line method- SLM)Dm=Ci-Cs/n where initial cost of the assets,
salvage/scrap/residual value and n is the number of year
i. Book value (Bm) at the end of m-years is given by: Ci-m x Dm
c. (Sum of year digit -SYD method) Depression rate for the nth year =

where N=total life

i. Depreciation amount = depression rate for nth year x total depression
3. Capitalized value : it is the amount whose annual interest at highest rate of interest will be
equal to the net income from the property
a. Capitalized value(V)= net annual income x year purchase
b. Year purchase = 1/(i+s) where i is the rate of interest and s is the sinking fund
coefficient
4. Annual cost recovery (capital recovery and return -CRR): based on the time value of money
that one has to pay throughout the useful life

Where, P = investment value at present i=minimum attractive rate of return (MARR)

n=useful life of the assets

Where Po = initial investment, P1=investment at the end of 1st year P2 = investment at

the end of 2nd year and r= interest rate
5. Process costing: Units are continuously mass produced through one or more processes
6. Contract costing (terminal costing): work is carried out in accordance with the customer special
requirements and each order is of longer duration
7. Work order costing (job order costing): it is a method for manufacturers producing very few but
very expensive sports cars.
8. Engineering economics: fixed cost, variable cost, total revenue but not sunk cost
a. Sunk cost –past expenditure, unrecoverable balance and invested capital that cannot be
retrieved
9. Marginal cost: The additional cost for the production of one more unit of product or service.

10. Cash flow analysis: financial statement that shows the total amount of money coming in and
going out
a. Depreciation: non-cash expense, net to add back to net profit.
 b. Decrease in debtors- less cash is tied up in the receivable account, need to add this
amount to net profit
c. Increase in creditors- company paid less cash for purchase, subtract this amount from
net profit
d. Interest paid – paid is an operating expense but not included in net profit, need to add
it back.
e. Purchase of furniture- it is an non-operating activity and not included in net profit, need
to exclude from the cash flow from operating activities
f. Purchase of other fixed assets- same as purchase of furniture

Cash flow operating activities= net profit +depreciation increase in creditors interest paid-
decrease in debtors – increase in inventory
11. Profitability index : financial tool that tells investment should be accepted or rejected
a. PI= present value of future cash inflows/present value of cash
outflows
b. PI>1 accept the investment
c. PI<1 reject the investment
d. PI=1 may accept or reject the investment
12. Cash used in operating activities = net loss as per profit & loss A/c + decrease in current assets –
increase in current assets – decrease in current liabilities
13. Methods of budgeting and their formula
a. ARR (Accounting rate of return) method= [average profit after tax/average
investment]*100
i. Average profit after tax=cash inflow – depreciation
1. Depreciation=[cost of assets +installation charges-scrap value]/n (life of
assets in year)
2. Average investment=[cost of assets -scarp]/2
b. Payback period method (PBP)= initial investment/annual cash inflow
c. NPV (Net present value) method= total present value of cash inflows- total present
value of cash outflows
d. Probability index= present value of cash inflow / present value of cash outflow
14. Time value of money: cash flow over time
15. Interest: earned or paid is a certain percentage of the amount loaned/borrowed
a. Simple interest=PTR/100
N
b. Compound interest, F=P*(1+i) =P*interest factor where i is the interest
and N is the interest period
c. P=F*(1+i)-N here p is the present worth F is the future worth and A is the amount
of a regular end of payment
d. Effective interest rate > nominal interest rate
=[1+i/1]n-1
i. Effective interest rate
i
ii. Continuous compounding= e -1
10.3 Project planning and scheduling: project classifications; project life cycle phases; project
planning process; project scheduling (bar chart, CPM, PERT); resources levelling and smoothing;
monitoring/evaluation/controlling.

1. Project life cycle:

2. Project planning process

Layout plan: to identify the sites in relation to town plan

Index plan: layout of colony. Like positon of road, market, hospital and parks

Key plan: represents the wall, room number, doors etc.

Service plan: includes different types of service like water supply, electrical devices, mechanical
service etc with in the factory

Site plan: used to locate the position of the building

3. Project scheduling : the process of determining the sequential order of the planned activities,
assigning duration and determining the start and finish date for each activity
a. Methods – Gant chart and network diagram (PERT/CRM)
b. Bar chart (Gant chart): visual representation of the sequencing and duration of activities
on any given project.
i. it was the first method invented for the planning projects in the year 1900
ii. graphical representation of activity vs time where horizontal is time duration
iii. The beginning and end of the each bar represents starting and finishing times of
a particular activity.
iv. Limitation:
1. Lack of degree of detail
2. Does not show progress of work
3. It cannot distinguish between critical and non-critical activities

c. CPS (critical path scheduling): A scheduling technique whose order and duration of a
sequence of task activities directly affects the completion date of a project.

d. Critical path method (CPM): it is applied when the things are almost certain – for non-
research and activity oriented method- it control time and cost – it uses deterministic
approach to calculate the duration of the project-one time estimate- best for large
project
i. used for controlling, planning and scheduling of the project
ii. Network diagram used to predict the total project duration.
iii. it determines the earliest time by which the project can be completed
iv. it is the longest path through network diagram
v. the total project cost is the sum of direct cost and indirect cost
1. Indirect cost- all the overhead cost, losses, penalty etc.
2. direct cost- cost including labour, material, plants and machinery
vi. it has the least amount of slack and float (amount of time activities can be
delayed without delaying the project finish time)
vii. CPM has some limitations when applied to detailed engineering design work
during early stage of a project.
Below is the example of critical path method
 viii. Float- maximum available time by which an activity can be delayed without
affecting the project completion time. It can positive, zero or negative.
1. Total float: maximum delay provided by any activity without affecting
the project duration; TF= Lj-Ej-dij lj- is the latest start time, Ej – is the
earliest start time
2. Free float: without affecting earliest time start of the successor activity;
FF=total float – head event slack
3. Independent float: without affecting earliest time start of the successor
activity as well as latest finish time; IF=free float – head event slack
IF=Ej-Li-dij
4. Relation; TF>FF>IF (on the critical path total, free and independent
floats all are equal and zero)

e. Program evaluation review technique (PERT) : preferred when there are some
uncertainties –useful for research bases activities and it is event oriented- it controls
only the time- it uses probabilistic approach to calcite the duration of the project-three
time estimate
i. It is the determination of the time duration for each task within a work break
down structure especially when there is high degree of complexity and
uncertainty about the task.
ii. Used to calculate the expected time for a task
iii. It uses optimistic time (shortest possible time) (O) pessimistic time (P) –
(longest possible time) and realistic time (R) – (manager best guess of the
amount of time under normal circumstances) estimates to calculate the
expected time (ET) or a particular task.
iv. the difference between O and P estimate of an activity is 6
v. ET or average time=[O+4R+P]/6
vi. The standard deviation of the critical path:
Standard deviation=root of (sum of variance along critical path) i.e. root of
(standard deviation2+ …n times...)

vii. to calculate variance

viii. the distribution assumed for the activity times is a beta distribution
ix. Slack: It is the maximum amount of time by which event can be delayed without
affecting the project duration.
1. When slack is positive- indicates that project is ahead of schedule. Such
events are called subcritical
2. If slack, is zero- indicates that work is in schedule time. Such events are
critical
 3. If slack is negative, the work is behind the schedule and may cause an
delay in project. Such events are called supercritical
4. Types -Slack of head : difference between Lj-Ej (latest finish time –
earliest finish time)
5. Slack of tail: difference between Ej-Lj
6. The path having the slack value are called the critical path which is also
the time wise the longest path.
f. Steps in PERT and CPM – define the activities- establish the dependencies- draw a
network diagram – establish the completion time – identity the critical path

g. Fulkerson’s rule is connected with the PERT and CPM

h. Critical path: longest path in the network diagram – the length of this path determines
the minimum duration required for the completion of the project
i. Critical activity: those activity lie on the critical path. The float of activities that lie on the
critical path is zero.

4. Optimizing method
a. Resources smoothing: An adjustment of resources without affecting duration
i. To solve the resource allocation problem in which the resources are considered
limited.
ii. The smoothing (adjustment) of resources resulting in the least variation of
resource demand is known as resource smoothing.
b. Resources levelling: An adjust of the resources with affecting the duration with same
cost of the project
5. Crash project duration – decreasing the timeline
a. (Crashing method of optimizing the cost of a project for an optimum duration of the
project. (reduction of duration for a few of the activities to optimize the cost)
b. Normal time: standard time with normal resource. Direct cost does not reduce with the
increase in time
c. Crash time: minimum possible time in which activity can be completed by employing
extra resources
d. Normal cost: expenditure incurred in the normal resources for completing activity in
normal time
e. Crash cost: normal expenditure + additional resource for crashing the time

Cost slope: [crash cost – normal cost] / [normal time – crash time]
 Crash point: it shows the time and cost when the activity is fully crashed.

6. Controlling- the process/ phase of project management in which the difference between the
schedule and actual performance once the project has begun.

Numerical

Activity on node and activity on arrow to find duration of the project

● Total project duration

● Late start time

● Late finish time

●
10.4 Project management: Information system; project risk analysis and management; project
financing, tender and its process, and contract management.

1. Types of production system

2. Management process

There are 4 main functions that managers should perform:

● Planning – this is the primary management function

● Organizing

● Leading

● Controlling

3. Cost of equity = [DP/MPS] + r Where, DPS=dividend per share MPS=market price per
share r= rate of interest
4. Fixation: inability to see the problem from a fresh prospective. For eg mental set
5. Project risk analysis:
a. Risk associated with portfolio- when two variables are negatively correlated, one
variable decreases as the other increases.eg acquiring other firms that have a negative
correlation.
b. Business risk-refers to the basic viability of business – company will be able to generate
the sufficient fund and cover all the cost and turn a profit?
c. Financial risk: concerned with the cost of financing. Eg salary, production cost, rent etc
d. Interest rate risk: risk that investment value will change due to the change in rate
e. Product risk: A risk directly related to the test object

6. Return of investment (ROI): ratio of average annual earing after tax to the average investment
after depreciation
ROI=annual average profit after tax/average investmentx100
BCR (benefit cost ratio) = if BCR is greater than 1 – positive net present value
NPV (net present value) = present value of cash inflow – present value of cash outflow
 PBP (payback period) = it calculates the number of year a project takes in recovering the initial
investment based on future cash inflows

7. Capital structure planning: initial fund collected by new company structure planning for various
expenses.
8. Project financing: after getting the project, planning of the financing expenses.
9. Capital budgeting decision: planning of project return value or not or efficiency whether to
spend or not

10. Project risk analysis and management

a. Risk management is the responsibility of – project team
b. Risk is expressed in terms of probability and impact
i. Risk exposure (risk priority number -1to 5/10) = probability x impact
c. Ways to deal with the risk: mitigate, contingency, transfer

11. Tender and its process

a. It is a written information or invitation by buyers sent to the potential suppliers or
contractors
b. It should specify the scope and obligations of the bidder
c. Ways –
i. limited tender: by issuing individual
ii. open tender: public tender by giving notice in newspaper