Data $ Cost of motor car 5,500 Trade in price after 2 years or 60,000 miles is expected to be 1,500 Maintenance - 6 monthly service costing 60 Spares/ replacement parts, per 1,000 miles 20 Vehicle License, per annum 80 Insurance, per annum 150 Tyre replacement after 25,000 miles, four at $37.50 each Petrol per gallon 1.90 Average mileage from one gallon is 25 miles Required: a. To prepare the schedule to be presented to management showing for the mileages of 5,000 ; 10,000 ; 15,000 ; and 30,000 miles per annum.
For : a) Total variable cost b) Total fixed cost c) Total costs d) Variable cost per mile e) Fixed cost per mile f) Total cost per mile b. "The more miles you travel, the cheaper it becomes.' In no more than 50 words, comment on, this statement.