Today, an investor who would like to invest in the transportation sector has to choose between Travego and Cityliner buses with capacity of 54 passengers. Travego's price is 675,000 TL, second hand value after 5 years is 340,000 TL and fuel consumption is 24 liters per 100 km. Cityliner's price is 740,000 TL, second hand value at the end of 5 years is 330,000 TL and fuel consumption is 20 liters per 100 km. The investor's plan is to run this bus for 5 years in Metro Tourism between Ankara and Istanbul for two round trips in a day for 350 days a year. The depreciation method is linear, the tax rate is 20%, and the cost of capital is 16%. As for the operations, 30% of one ticket sale of 60 TL is cut off at the source and 42 TL is paid per passenger. The fixed costs are as follows: Monthly gross personnel cost per driver 4,500 TL (there are 3 drivers) Monthly gross personnel cost per bus attendant is 1,800 TL (there are 3 bus attendants) Annual maintenance and repair cost for Travego is 8,000 TL Cityliner is 12,000 TL Annual bus tire cost for each of the busses is 12,000 TL Annual vehicle inspection cost is 600 TL Monthly motor insurance is 1,000 TL Monthly traffic insurance is 120 TL Monthly hospitality and catering cost paid to Metro Tourism is 2,500 TL Ankara – İstanbul highway fare is 40 TL Esenler Bus Station entrance fee is 60 TL AŞTİ entrance fee is 50 TL İstanbul bridge toll is 25 TL İstanbul is 550 km from Ankara and price of 1-liter diesel is 4.00 TL. Accordingly, find out how many passengers to carry on a one-way trip to break-even in both accounting and finance views. Which of the buses should the investor choose? Why?

Answer rating: 100% (QA)

Summary Travego TL Cityliner TL Price 675000 740000 Second hand value 340000 330000 Fuel consumption ... View the full answer