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Kristen Lu purchased a used automobile for $ 2 8 , 1 5 0 at the beginning of last year and incurred the following operating
Kristen Lu purchased a used automobile for $ at the beginning of last year and incurred the following operating costs:
Depreciation $: years $
Insurance $
Garage rent $
Automobile tax and license $
Variable operating cost $ per mile
The variable operating cost consists of gasoline, oil, tires, maintenance, and repairs. Kristen estimates that, at her current rate of usage, the car will have zero resale value in five years, so the annual straightline depreciation is $ The car is kept in a garage for a monthly fee.
Required:
Kristen drove the car miles last year. Compute the average cost per mile of owning and operating the car. Round your answers to decimal places.
Fixed cost per mile
Variable operating cost per mile
Average cost per mile
Kristen is unsure about whether she should use her own car or rent a car to go on an extended crosscountry trip for two weeks during spring break. What costs above are relevant in this decision? You may select more than one answer. Single click the box with a check mark for correct answers and double click to empty the box for the wrong answers.
Variable operating costs
Depreciation
Automobile tax
License costs
Insurance costs
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