Explain what costs from the previous list are relevant

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Hart Company sells and delivers office furniture across Western Canada.

The costs associated with the acquisition and annual operation of a delivery truck are given below:

Insurance $4,446

Licences $210

Taxes (vehicle) $124

Garage rent for parking (per truck) $1,240

Depreciation ($26,000 ÷ 5 years) $5,200

Gasoline, oil, tires, and repairs $0.21/km

Required:

Question 1: Assume that the company decides to use the truck during the second year. Near year-end, an order is received from a customer over 1,000 kilometres away. What costs from the previous list are relevant in a decision between using the truck to make the delivery and having the delivery done commercially? (Round your answer to 2 decimal places.)

Reference no: EM132633340

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