a motor vehicle has an annual depriciation of $1900; oil changes cost $270, automobile insurance $570 annualy, and licesne plate

Question

3 years ago

11

s cost $150. What is the annual amount of the total fixed operating cost for this vehicle?

1 answer:

Alenkasestr [34] · Answer 1 · 2022-03-27T15:09:43+03:00

Answer: $2620

Explanation:

Fixed cost are the cost that are used for production that doesn't vary with the production level.

From the question, the annual amount of the total fixed operating cost for this vehicle will be:

= Annual Depreciation + Automobile Insurance + License plates

= $1900 + $570 + $150

= $2620

It should be noted that oil change cost is a variable cost.

Therefore, the annual amount of the total fixed operating cost for this vehicle will be $2620.