E Click the icon to view the shipments table The cost to Bruin of sending a truc
ID: 334570 • Letter: E
Question
E Click the icon to view the shipments table The cost to Bruin of sending a truck from Los Angeles to Atlanta is $2,000. The maximum load per truck is 20,000 pounds. If Bruin were to use a direct truck shipment for each customer, the shipping costs would be $2,000 per customer, or $6,000 total The weight utilization across all three trucks would be 10,000 pounds/60,000 pounds, or just 17%-hardly an economic or environmentally wise use of resources But suppose Bruin has a consolidation warehouse where loads from multiple customers can be combined. Of course, there are costs associated with consolidation. Assume that the cost of running the warehouse is approximately 59 per hundred-weight Furthermore, if Bruin decides to consolidate the three shipments, it must consider the additional cost of breaking them up for local delivery, which is not an issue in direct trucking. Suppose the cost of breaking up the shipments is $200 for each customer. Under these conditions, the costs of consolidating the three shipments to Atlanta would be: EEB Click the icon to view the consolidated delivery costs Given all of this information, recalculate the cost of the consolidation option if all costs remain the same except a. The cost of running the warehouse doubles to $18 per hundred-weight. All other values stay the same as provided in the problem statement. The cost of the consolidation option is now (Enter your response as a whole number) b. Delivery costs to each customer fall to $150. All other values stay the same as provided in the problem statement. The cost of the consolidation option is now sEnter your response as a whole number) c.Cost of sending a truck from Los Angeles to Atilanta falls to $1,800, but delivery costs rise to $250 per customer. All other values stay the same as provided in the problem statement The cost of the consolidation option is now (Enter your response as a whole number)Explanation / Answer
Total cost of consolidation option
= Consolidated Trucking cost + Warehousing cost per hundred weight / 100 x 10000 lbs + Delivery cost / customer x 3 customers
Answer to question a :
Cost of running the warehouse = $18 per hundred weight ( all other costs same as provided in the problem statement )
Total cost of consolidation option
= $2000 + $18/100 x 10,000 + $200 x 3
= $2000 + $1800 + $600
= $4400
Answer to question b :
Delivery cost to customer = $150 ( all other costs as provided in the problem statement )
Total cost of consolidation option
=$2000 + $9/100 x 10,000 + $150 x 3
= 2000 + $900 + $450
= $3350
Answer to question c :
Cost of sending a truck = $1800 , Delivery cost /customer = $250 ( all other costs as provided in the problem statement )
Total cost of consolidation option
= $1800 + $9/100 x 10,000 + $250 x 3
= $1800 + $900 + $750
= $3450
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