Question 1 - Motor Car
Cost of motorcar £10,000
Trade-in price after 2 years or
60,000miles £2,000
Maintenance (6 monthlyservicing) £120
Spares (per 1,000miles) £40
Road Tax (perannum) £150
Insurance (perannum) £450
Tyres (after 25,000miles) £240
Petrol (perLitre) £2.10
Petrol consumption is 25 mpg.
From the above data you are required:
Calculate manually the following costs:
1. Total variable cost
2. Total fixed cost
3. Total cost
4. Variable cost per mile
5. Fixed cost per mile
6. Total cost per mile.
The latter threecosts should be shown to the nearest penny.
For 0, 5,000,10,000, 20,000 and 30,000 miles per annum.