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Kristen Lu purchased a used automobile for $32,050 at the beginni.pdf

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Kristen purchased a used car for $32,050 last year and incurred variable operating costs such as gas, oil, tires, maintenance and repairs. She estimates the car will be worth $0 in 5 years, so the annual depreciation is $6,410. She also pays monthly garage fees. To calculate the average cost per mile, we must consider the purchase price, annual depreciation, garage fees and variable operating costs for the 25,000 miles driven last year.

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Kristen Lu purchased a used automobile for $32,050 at the beginning of last year and incurred the following operating costs: 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 $6,410. The car is kept in a garage for a monthly fee. Required: 1. Kristen drove the car 25,000 miles last year. Compute the average cost per mile of owning and operating the car. (Round your answers to 2 decimal places.) Required: 1. Kristen drove the car 25,000 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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