CA Intermediate · Cost and Management Accounting · Service Costing
Shree Travels runs a bus on a route of 200 km one way, making 2 round trips every day for 25 days in a month. The bus has 40 seats and runs with 75% average seat occupancy. What is the number of passenger-kilometres (absolute) for the month?
The bus covers 800 km per day, or 20,000 km in 25 days, with an average of 30 passengers on board. Multiplying gives 6,00,000 passenger-kilometres. Counting only one direction would wrongly halve the figure to 3,00,000.
- A6,00,000Correct
- B3,00,000
- C4,00,000
- D8,00,000
Explanation
Distance per day = 200 x 2 (round trip) x 2 trips = 800 km. Monthly distance = 800 x 25 = 20,000 km. Passengers carried on average = 40 x 75% = 30. Passenger-km = 20,000 x 30 = 6,00,000. The figure 3,00,000 comes from counting only one-way distance.
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