variable costs. Help please

timer Asked: Jan 14th, 2013

Question Description

1)  What is the establishment cost (E) using the following information?


2) What is the variable (V) cost of this information?


2) what is the cost (C) of the tours?





A tourist coach company offers a daily (week days) tour from Bryon Bay to Lismore and return. People taking the tour are supplied lunch

The company puts a weekly advertisement in the local paper costing $120.

Each passenger is charged $45 (including lunch) for the return journey.

The fuel cost and other running costs total $45 per trip.

The driver’s wage is $120 per trip.

Lunch cost is $14 per person

They wish to make a WEEKLY profit.



(where C cost, V is variable costs and E is establishment cost)



C =V5+E




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