=+ Thirty trucks could be purchased, each with a capacity of 15 cubic metres. Each truck would
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=+◗ Thirty trucks could be purchased, each with a capacity of 15 cubic metres. Each truck would cost $40000. The trucks consume 7 litres of petrol per 100 km driven. The same deliveries could be made driving only 300000 km (per truck). The annual maintenance, registration and insurance is $1200 per truck. The trucks have an effective life of 400000 km, with a zero residual value.
Required 1 Assuming that the price of fuel is $1.40 per litre, which alternative do you prefer on financial grounds?
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Authors: Monte Wynder, Madhav V. Rajan, Srikant M. Datar, Charles T. Horngren, William Maguire, Rebecca Tan
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