Costing Models You work for XYZ trucking and your boss has asked you to figure out how much the firm should charge a new customer to make a full Truckload delivery and make a 15% profit. The firm knows that it will find a backhaul customer, so you only need to worry about the cost for the move. The shipment consist of 425 boxes weighing 100 pounds each, and measuring 4 cubic feet each. The trailers that your company uses can carry 46,000 pounds and have a volume of 3,600 cubic feet. You calculate that it will take 5 hours to drive from your terminal to the customer's factory, wait for the truck to be loaded and return to your terminal. The distance between your terminal and your customer's factory is 15 miles. Your line haul driver will then take the truck to the consignee and deliver the boxes. The total distance from your terminal to the consignee is 1300 miles and will take the driver 40 hours. Once at the consignees it will take 4 hours to offload the truck. Then the driver will go to the XYZ trucking terminal in the same city, which is 50 miles away. What would you recommend to your boss that the priceshould be set per cwt to complete this move? (Make sure to show your calculations) The equipment cost data is as follows: Equipment Cost Data Equipment Purchase Price Line-haul tractors $115,000 Trailers $36,000 53-foot dry van Depreciation Tractors Trailers 4 year straight line 7 year straight line Interest Tractors 4% APR for 4 years Trailers 4% APR for 7 years Fuel Per Gallon $ 3.86 Line-haul tractors 6 miles per gallon Labor Cost Line-haul drivers PUD operation drivers $ 0.47 $25.00 per mile per hour Miscellaneous Insurance cost $ 0.056 per mile Maintenance cost per mile Billing cost $ 0.155 $ 2.00 15% per freight bill Administrative overhead of total cost Equipment available for use 365 days, 24 hours per day - 8,760 hours per year. Costing Models You work for XYZ trucking and your boss has asked you to figure out how much the firm should charge a new customer to make a full Truckload delivery and make a 15% profit. The firm knows that it will find a backhaul customer, so you only need to worry about the cost for the move. The shipment consist of 425 boxes weighing 100 pounds each, and measuring 4 cubic feet each. The trailers that your company uses can carry 46,000 pounds and have a volume of 3,600 cubic feet. You calculate that it will take 5 hours to drive from your terminal to the customer's factory, wait for the truck to be loaded and return to your terminal. The distance between your terminal and your customer's factory is 15 miles. Your line haul driver will then take the truck to the consignee and deliver the boxes. The total distance from your terminal to the consignee is 1300 miles and will take the driver 40 hours. Once at the consignees it will take 4 hours to offload the truck. Then the driver will go to the XYZ trucking terminal in the same city, which is 50 miles away. What would you recommend to your boss that the priceshould be set per cwt to complete this move? (Make sure to show your calculations) The equipment cost data is as follows: Equipment Cost Data Equipment Purchase Price Line-haul tractors $115,000 Trailers $36,000 53-foot dry van Depreciation Tractors Trailers 4 year straight line 7 year straight line Interest Tractors 4% APR for 4 years Trailers 4% APR for 7 years Fuel Per Gallon $ 3.86 Line-haul tractors 6 miles per gallon Labor Cost Line-haul drivers PUD operation drivers $ 0.47 $25.00 per mile per hour Miscellaneous Insurance cost $ 0.056 per mile Maintenance cost per mile Billing cost $ 0.155 $ 2.00 15% per freight bill Administrative overhead of total cost Equipment available for use 365 days, 24 hours per day - 8,760 hours per year
