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Management Science, Exercise 2. With clear formatting and solution please. Thank you! NEED ASAP. :))

CoursHeroTranscribedText: Exercise 2 (Identification of Relevant Costs) Ingrid Yee purchased a used automobile for P10,000 at the beginning of last year and incurred the following operating costs: Depreciation (P10,000 + 5 years). P2,000 Insurance.. P960 Garage rent....... P480 Automobile tax and license. P60 Variable operating cost. 8c per km. The variable operating costs consist of gasoline, oil, retires, maintenance, and repairs. Ingrid estimates that at her current rate of usage, the car will have zero value in five years, so the annual straight-line depreciation is P2,000. The car is kept in a garage for a monthly fee. Required: 1. Ingrid drove the car 10,000 kms. last year. Compute the average cost per km. of owning and operating the car. 2. Ingrid is unsure about whether she should use her own car or rent a car to go on an extended country trip for two weeks during summer break. What costs above are relevant in this decision? Explain. 3. Ingrid is thinking about buying an expensive sports car to replace the car she bought last year. She would drive the same number of kms. irrespective of which car she owns and would rent the same parking space. . The sport car's variable operating costs would be roughly the same as the variable operating costs of her old car. However, her Relevant Costs or Decision Making 761 insurance and automobile tax and license costs would go up. What costs are relevant in estimating the incremental cost of owning the more expensive car? Explain

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