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DP World paid Cdn$676 million to buy the container port called Fairview DP World spent an additional Cdn$200 million for an expansion that readied Fairview
- DP World paid Cdn$676 million to buy the container port called Fairview
- DP World spent an additional Cdn$200 million for an expansion that readied Fairview to accept the largest vessels at sea
- DP World's total investment was Cdn$876 million ($676 million purchase price + $200 million expansion cost).
- Of the $876 million invested by DP World into the Fairview container port, 95 percent ($788.4 million) was invested in the loading/unloading department assets and 5 percent ($43.8 million) was invested in the container decontamination department assets.
- The total joint variable costs for loading/unloading in 2020 was $36.5 million.
- In 2020, the loading/unloading department for DP World's Prince Rupert facilities handled on average 3,600 of the 45-foot containers per day. In 2020, the container decontamination department for DP World's Prince Rupert facilities handled on average 400 of the 45-foot containers per day
- DP Worlds $200 million expansion readied Fairview to accept the largest vessels at sea, which are increasingly favored by shippers seeking to load more containers to reduce costs.
- The port variable overhead costs are allocated to the operating departments using the direct method.
- The costs for 2020 show the various rates related to the Fairview Container port as follows
- Complete an analysis of the operating income and cost per container as shown below. Your answer should follow the following template. Hints are shown in yellow highlights in the template below.
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