Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

value: 50.00 points Kristen Lu purchased a used automobile for $20,650 at the beginning of last year and incurred the following operating costs: $4,130 Depreciation

image text in transcribedimage text in transcribed

value: 50.00 points Kristen Lu purchased a used automobile for $20,650 at the beginning of last year and incurred the following operating costs: $4,130 Depreciation ($20,650 5 years) $2,200 Insurance $1,100 Garage rent Automobile tax and license $570 $0.11 per mile Variable operating cost 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 straight-line depreciation is $4,130. The car is kept in a garage for a monthly fee. Required: 1. Kristen drove the car 20,000 miles last year. Compute the average cost per mile of owning and operating the car. (Round your answers to 2 decimal places.) Fixed cost per mile Variable operating cost per mile Average cost per mile

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamentals of Cost Accounting

Authors: William Lanen, Shannon Anderson, Michael Maher

4th edition

78025524, 978-0078025525

More Books

Students also viewed these Accounting questions

Question

Do you remember who said And away we go?

Answered: 1 week ago