Answer:
Total annual operating cost = $6,610
Explanation:
Given;
Annual depreciation = $2,500
Annual mileage = 13,200
Current year's loan interest = $650
Miles per gallon = 24
Insurance = $680
License and registration fees = $65
Average gasoline price = $3.50 per gallon
Oil changes/repairs = $370
Parking/tolls = $420
Now,
The cost of gas for annual mileage = ![\frac{13,200}{24}\times\$3.50](https://tex.z-dn.net/?f=%5Cfrac%7B13%2C200%7D%7B24%7D%5Ctimes%5C%243.50)
= $1,925
Thus,
Total operating cost =
Annual depreciation $2,500
+ cost of gas for annual mileage $1,925
+ loan interest $650
+ Insurance $680
+ License and registration fees $65
+ Oil changes/repairs $370
+ Parking/tolls $420
=================================================
Total annual operating cost $6,610