Scenario: Jozi Delights Unlimited (JDU) ozi Delights Unlimited (JDU) operates as a desserts and milkshakes delivery provider. They have been Icovering most of Gauteng from a number of mobile units scattered at various locations throughout the province. The area manager has been thinking of reviewing the current systems and procedures that JDU has in place. She has provided the following information to the newly appointed management accountant: The cost of a delivery van The driver is paid R85.50 per hour. The number of hours worked is based on the distance driven. An hour is assumed to be 100 km based on an average speed of 100 kilometres per hour. The cost of servicing the delivery vehicles every 50,000 km Full delivery van tyre replacement cost (all tyres) R300,000 For every 2,000 km driven, the cost R3,200 of spares and replacement parts The tyre safety policy states that tyres are to be replaced every 20,000 km. R9,000 Diesel cost is calculated on a per litre basis R6,000 R13.20 The new fleet of delivery vehicles drive approximately 13 km on one litre of fuel. The annual delivery van insurance per vehicle The delivery van road vehicle licence annual fee R12,000 R1,100 Practical tasks Use a spreadsheet to complete the following task: Using the information provided above, prepare a table that can be used to estimate the annual costs for a delivery van that accumulates mileage in multiples of 15,000 up to a maximum of 300,000 km. Hint: Classify and group your costs in your table to make it easier for you in the presentation part below. Research and presentation Using Word, prepare a short report for the area manager covering the following criteria: The area manager is under the impression that the total cost per kilometre will always fall as the delivery van is driven over a greater distance'. Use graphs (workings prepared in Excel) to illustrate your explanations. What is the annual cost of running a delivery van for each of the annual distances? What is the variable cost per kilometre? What is the fixed cost per kilometre? What is the total cost per kilometre?