Question

Following is not the method of apportionment of total cost of multipurpose reservoir:
1. Remaining benefit method
2. Use of facilities method
3. Equal apportionment
4. Direct method

Answer 1

Correct Answer - Option 4 : Direct method

Concept:

Apportionment of total cost of multipurpose reservoir:

• It means the sub-division of cost for various uses for which reservoir is planned.
• The following are the various methods of apportionment of total cost:

1. Equal apportionment method:
2. Use of facilities method
3. Remaining benefits method
4. Alternative justifiable expenditure method

Equal apportionment method:

• In this method, the joint cost of the project is equally divided into different purposes, irrespective of the separate cost of the benefit.
• This method is not based on convincing logic.
• It is used only when the data available is so meagre (i.e. lacks in quantity and quality).

Use of facilities method:

• The joint cost is divided in the ratio storage volume provided for each purpose.
• The cost is indirectly proportional to the storage.

Remaining benefits method:

• The joint cost is assumed to be distributed in accordance with the difference between the separable cost and the estimated benefit of each function (i.e. all the function of the multipurpose reservoir).
• It is the best of all the methods.
• It is also the most accurate method.

Alternative justifiable expenditure method:

• The joint cost is distributed in the ratio of the difference between separable cost and the estimated cost of single-purpose project.