2016 S02 P02 EXCEL

You are the financial manager for Tefo Transport Pty Ltd, a company which deals with providing public transport to the residents in and around Pretoria. Tefo Transport is a registered VAT vendor.

The owner of the company Mr Tefo wants to purchase an additional vehicle for business purposes. He is considering 4 options, to purchase a 5 seater vehicle which will work as a metered taxi for local customers, a 15 seater quantum for transporting local passengers from town to the nearby townships, a 22 seater minibus for transporting passengers between Pretoria and Johannesburg, and a 65 seater bus for transporting passengers from Pretoria and a nearby township at specified times of the day.

He has requested you to assist him with the monthly instalment and additional costs that his company will incur for purchasing each vehicle.

He provided you with the following information

• The Value Added Tax (VAT) percentage is equal to 14% (refer to cell B3)
• Interest for each vehicle will be compounded monthly at the end of each month at a rate of 10% per annum (refer to cell B4)
• The loan for each vehicle will be repaid in 5 years (refer to cell B5)
• Monthly maintenance costs for each vehicle will be equal to 1% of its cost price including VAT (refer to cell B6)
• Petrol price per litre is R11.50 (refer to cell B7) and Diesel price per litre is R11.00 (refer to cell B8)
• Fuel code for each vehicle is either A or B, where A represents Petrol and B represents Diesel
• For each vehicle’s fuel code (refer to cells B12:B15)
• For the litres of fuel used by each vehicle per month (refer to cells C12:C15)
• Monthly salary for the driver of each vehicle will be equal to monthly fuel costs less R1,000.00


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