These are variable expenses that can change throughout the life of the operation depending on seasonal conditions, ridership trends, regional conditions and age of equipment. The other type of expense item on the income statement is fixed expenses. This includes insurance, rent, leases without mileage limits and vehicle communication devices. These expenses are easier to plan for than the variable expenses because they stay the same throughout the life of the agreement. They are also usually easier to obtain matching funding for because of the consistency of the dollar amounts.
Variable expenses are more suited to in-kind funding due to the changing dollar amounts.
Another side to the vehicle recordkeeping is utilization. It is important because a cost can be associated with the number of trips provided. The operations that have a long life normally have a lower cost per trip than a competitor because the long term operation has achieved economies of scale over time. An example of this would be a full time mechanic costing less than contracting repairs to an outside vendor. Next is a standard formula for calculating cost per ride.