Question

Assume that hart company owns one truck that has been driven 62,000 kilometres during the first year. Compute the average cost per kilometre of owning and operating the truck.

Answer 1

To calculate the average cost per kilometre for a truck driven 62,000 km in its first year, divide the total cost of operating the truck by the total kilometres driven.

Step-by-step explanation:

To compute the average cost per kilometre of owning and operating a truck that has been driven 62,000 kilometres during the first year, one must know the total costs involved in owning and operating the truck including the purchase price, maintenance, insurance, fuel, and any other costs accrued over the year. Once the total cost is calculated, divide it by the total kilometres driven to get the average cost per kilometre.

For instance, if the total cost of owning and operating the truck for the year was $31,000, the calculation would be as follows:

1. Calculate total costs (example: $31,000).
2. Divide total costs by total kilometres driven (example: $31,000 / 62,000km).
3. This would yield an average cost per kilometre (example: $0.50/km).

Remember, for a precise calculation, all operating and ownership costs over the period must be included.