Kristen Lu purchased a used automobile for $10,100 at the beginning of last year and incurred the following operating costs:Depreciation ($10,100 ÷ 5 years)InsuranceGarage rentAutomobile tax and licenseVariable operating cost$ 2,020$ 1,100$ 500$ 280$ 0.11 per mileThe variable operating cost consists of gasoline, oil, tires, maintenance, and repairs. Kristen estimates, at her current rate of usage, thecar will have zero resale value in five years, so the annual straight-line depreciation is $2,020. The car is kept in a garage for a monthlyfee.Required:1. Kristen drove the car 13,000 miles last year. Compute the average cost per mile of owning and operating the car.Note: Round your answers to 2 decimal places.× Answer is complete but not entirely correct.Average fixed cost per mile$0.30Variable operating cost per mile$0.41Average cost per mile$0.71

Fixed CostsFixed costs are those that do not change with the number of miles driven. These include…

Answered: Kristen Lu purchased a used automobile…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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In the financial year ended 31 December 2009, Sister Edith sold a car for $15,000. The car had been bought on 2 January 2006 for $45,000. Sister Edith depreciates motor vehicles on the reducing balance basis at a rate of 20% per annum. She charges a full year's depreciation in the year an asset is bought, and no depreciation in the year it is sold. What is the profit or loss on disposal of the car?
(b) Chichi is unsure whether she should use her own car or rent a car to go on an extended cross-country trip for two (2) weeks during the mid-term break. Explain and identify which of the above costs are relevant and which are irrelevant in her decision.
Adebola deliver service uses two delivery vans. Her business policy is to replace the vans every 4 years. One of the vans which was bought 4-years ago at a cost of £12,750, is due for replacement. Adebola depreciates the vans using the reducing balance methods at a rate of 25% per annum. She accepts an offer of £3,650 for the van. What is Adebola’s profit or loss on the sale of the Van after year 4?
A homeowner remodeled their kitchen in November 2018. The remodel project included purchasing a high-end residential grade dishwasher with a 10 year useful life expectancy that cost $10,000. The current replacement cost of the dishwasher is $15,000. Breaking news: Last night a fire destroyed the dishwasher. If the homeowner maintains Property coverage on an actual cash value (ACV) basis, how much would they recover from their insurer for the dishwasher? $5,000 $10,000 O $7,500 O $15,000
Mr. Pans owns and operates several retail auto parts and accessories outlets. Management is now considering the possibility of terminating the operation of the Accessories Store and leasing the facilities to another retailer. The monthly results of the Accessories Store operations are as follows: Sales P940,000 · Operating expenses directly identifiable with the outlet: Cost of goods sold, etc P890,000 Depreciation 80,000 If operation of Accessories Store is terminated, Mr. Pans can rent-out the facilities for P60,000 a month to a non-competing business. Determine whether the company should continue operations or terminate the Accessories Store and rent-out the facilities. How much is the advantage of better option? 1. Coniinue the Accessories Store – advantage of P 50,000 2. Terminate operation of Accessories Store - advantage of P50,000 3. Continue the Accessories Store - advantage of P10,000 | 4. Terminate operation of Accessories Store - advantage of P10,000
The home was acquired for $83,000 in 2005. On May 12, 2021, the Arcs installed new fixtures (7-year recovery period) at a cost of $3,400. They wish to maximize the cost recovery on the new fixtures but make no elections. how do I calculate Special depreciation allowance for qualified property Rental income Insurance Interest expense Property taxes Miscellaneous expenses $16,100 800 5,750 1,200 500
Kristen Lu purchased a used automobile for $13,200 at the beginning of last year and incurred the following operating costs: Depreciation ($13,200 - 5 years) $ 2,640 Insurance $ 1,400 Garage rent $ 700 Automobile tax and license $ 360 Variable operating cost $ 0.08 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 straight - line depreciation is $2,640. The car is kept in a garage for a monthly fee. Required: 1. Kristen drove the car 17,000 miles last year. Compute the average cost per mile of owning and operating the car. (Round your answers to 2 decimal places.)
Please help me solve both questions
Betterway Pharmacy has purchased a small auto for delivery of prescriptions. The auto cost $30,000 and will be usable for five years. Delivery of prescriptions (which the pharmacy has never done before) should increase revenues by at least $29,000 per year. The cost of these prescriptions will be about $21,000 per year. The pharmacy depreciates all assets by the straight-line method. A. Compute the payback period on the new auto B. Compute the simple rate of return of the new auto. Answer in 2 decimal places
on july 17, 2022, herman places in service a used automobile that cowt $30,000. the car is used 80% for business and 20% for personal use. in 2022, he used the automobile 40% for business and 60% for personal use. herman chooses not to take 179 or additional first-year depreciation. determine the cost recovery recapture for 2023.
Sophia purchased the following assets in 2020. 4-15-20 New Computer $2,600 7-02-20 Office Furniture $10,000 10-2-20 Office Equipment $16,200 Sophia does not want to take any 179-expense deduction or any additional first year depreciation. Calculate the cost recovery for 2020.
s Kristen Lu purchased a used automobile for $28,150 at the beginning of last year and incurred the following operating costs: Depreciation ($28,150+ 5 years) Insurance Garage rent Automobile tax and license Variable operating cost $ 5,630 $ 2,900 $ 1,500 $ 770 $ 0.07 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 straight-line depreciation is $5,630. The car is kept in a garage for a monthly fee. Average fixed cost per mile Variable operating cost per mile Average cost per mile Required: 1. Kristen drove the car 27,000 miles last year. Compute the average cost per mile of owning and operating the car. (Round your answers to 2 decimal places.)

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