PLease answer in 30 minutes and round correctly! Thank you 1.Each week the ABC C

Question

PLease answer in 30 minutes and round correctly! Thank you

1.Each week the ABC Company, from Albuquerque, NM receives 95 separate LTL shipments from a number of different suppliers in the Dallas, TX area. Each parcel shipment from Dallas to Albuquerque costs $120.

Alternate Shipping Method

A Dallas-based 3PL provider has approached ABC Company with a proposal to run a consolidation operation where they would pick up the supplier shipments each week and load them on to one truck for shipment to Albuquerque. The relative data for this alternative shipping method are as follows:

Local pickup fee = $41 pickup fee

Average weight per supplier shipment = 150 lbs.

Local consolidation fee = $35 per hundred-weight

Consolidated TL shipment from Dallas to Albuquerque = $1,372

a.What is the total cost of shipping the separate parcel shipments from the Dallas-area suppliers to the ABC company location in Albuquerque? (Display your answer as a whole number.)

b.How much money would ABC Company save to hire the 3PL to pickup the shipments from each supplier and consolidate them into one bulk shipment to Albuquerque? (Display your answer as a whole number.)

c.At what cost for local pickup does the cost of the two options become the same? (Display your answer to two decimal places.)

Explanation / Answer

a)

The total cost of shipping separate parcel shipments = 95 * 120 = $11400

b)

Local pick up fee = $ 41

Weight per 95 shipments = 95*150 = 14250lbs

Local consolidation fee for 14250lbs =(35*14250)/100 = $4987.5

Consolidated TL shipment = $1372

Total cost when 3PL is hired = 41*95+4987.5+1372 =$10254.5

Money saved = 11400-10254.5=$1145.5

c)

Cost of local pick up = (11400-4987.5-1372)/95 = $53.06

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