The Union Transport Company supplies the following details in respect of a truck of 5 tonne capacity:
|
Cost of truck |
Rs 90,000 |
|
Estimated life |
10 years |
|
Diesel, Oil, grease |
Rs 15 per rip each way |
|
Repairs and maintenance |
Rs 500 per month |
|
Driver’s wages |
Rs 500 per month |
|
Cleaner’s wages |
Rs 250 per month |
|
Insurance |
Rs 4,800 per year |
|
Tax |
Rs 2,400 per year |
|
General supervision charges |
Rs 4,800 per year |
The truck carries goods to and from the city covering a distance of 50 miles each way. While going to the city, freight is available to the extent of full capacity and on return 20% of the capacity. Assuming that the truck runs on an average 25 days a month.
Work out:
- Operating cost per ton mile and
- Rate per ton per trip that the company should charge, if a profit of 50% on freightage is to be earned.