Vehicle costing and replacement

Question 1

What is different range of depreciation methodologies?

Answer 1

• Straight-line depreciation
• Accelerated depreciation
• Tax allowance
• Residual value depreciation

Question 2

What are the 3 levels of replacement cycle preparation?

Answer 2

*Arbitrary replacement cycles( Replacement hinges on the company swapping its vehicles when it can afford to do so

*The predetermined cycle approach(The company selects its cycle)

*The economic replacement cycle

Question 3

What is service life?

Answer 3

it is the amount of time the vehicle can render a service

Question 4

What is technological life?

Answer 4

represents its productivity decline relative to newer models on the market

Question 5

what is economic life?

Answer 5

relates to the total stream of costs associated with vehicle over a certain period