Currently, Fire Station 51 and Fire Station 81 operate separate EMS trucks. Station 51 has operating costs of $46,000 per year. Station 81 reports operating cost of $42,000 per year. Station 51 utilizes its truck about 65% of the time, and Station 81 has an operating efficiency of about 40%. The fire stations are trying to determine the benefits of only operating one EMS truck that they will share. Based on the extended needs, the newer EMS truck will cost $80,000. Using the incremental cost allocation, how much of the new EMS truck should be allocated to each fire station?

Question

Quizplus · Accepted Answer

$80,000 - $46,000 = $34,000 
Com costs - station 51 cost (higher ranked) = station 81 cost

Currently, Fire Station 51 and Fire Station 81 Operate Separate