Ajax County owns a fleet of twelve (12) cars, which is operated as a motor pool serving the countys four main departments. Each department is roughly equal in size. The accounting system indicates that the motor pool has incurred the following total costs in the just-finished fiscal year:

Labor $37,000

Depreciation of cars $26,000

Depreciation of maintenance equipment $5,000

Insurance $4,000

Gasoline $13,000

1. Direct and indirect costs. The county manager wishes to charge the costs of running the motor pool to the four departments. The records, based on odometer readings, show that Department A used the cars for 80,000 miles, Department B for 50,000 miles, Department C for 40,000 miles, and Department D for 30,000 miles. How much should each department have been charged for the use of the cars this past fiscal year?

1. Fixed and variable costs. The county manager wants to set a per-mile charge for next year, and she wishes to cover her full costs through the charge. She expects the total mileage to increase by 20 percent next year. If depreciation and insurance represent fixed costs, what should be the per-mile charge next year?