Drive Comfort Transport Co. has been given a route 20 km. long for running buses. The company has a fleet of 10 buses each costing 50,000 and having a life of 5 years without any scrap value.

From the following estimated expenditure and other details calculate the bus fare to be charged from each passenger.

(i) Insurance charges 3 % p.a.

(ii) Annual tax for each bus 1,000

(iii) Total garage charges 1,000

(iv) Drivers' salary for each bus 150 p.m

(v) conductor's salary for each bus 100 p.m

(Vi) Annual repairs to each bus 1,000

(vii) Commission to be shared by the driver and conductor equally: 10% of the takings

(viii) Cost of stationary 500 p.m.

(ix) Manager's salary 2,000 p.m.

(x) Accountant's salary 1,500 p.m.

(xii) Petrol and oil 25 per 100 km

Each bus will make 3 round trips carrying on an average 40 passengers on each trip. The bus will run on an average for 25 days in a month. Assuming 15% profit on takings, calculate, the bus fare to be charged from each passenger.

Answer rating: 100% (QA)

Cost of buses The total cost of the buses is 10 buses 50000 500000 Since the life of a bus is 5 year... View the full answer