LTL Costing Exercise Equipment Cost Data Your task is to calculate the cost of this shipment and determine what is the minimum rate that the carrier should charge for this shipment per hundred weight (cwt). The shipment consists of 25 cartons, each weighing 30 pounds and measuring 15 cubic feet. The carrier's trailers have a weight capacity of 40,000 pounds and 2,880 cubic feet. This shipment then occupies 1.875 percent of the trailer's weight capacity and 13 percent of its cubic capacity. Because the cubic feet requirement is greater, it will be used to allocate costs in the line-haul. Route and Time of Movement The shipment is picked up by the carrier's driver in a pickup and delivery (PUD) city tractor/trailer unit on June 1, 2005, as one of 18 stops made by the driver that day from 0730 EST to 1730 EST. The stops covered a total of 40 miles within the Altoona, Pennsylvania satellite terminal service area. The shipment was one of three handled by the carrier at this particular shipper's location. Once the pickup vehicle returns to the Altoona terminal, it takes 30 minutes to move the shipment from the city unit across the dock to the line-haul trailer. Equipment Purchase Price 1. PUD tractor -S43,600 2. LH tractor - $65,000 3. PUD trailer - $14,000 4. LH trailer - $19.000 Depreciation 1. Tractors = five-year straight line 2. Trailers = eight-year straight line Interest 1. Tractors = 10 percent APR for five years 2. Trailers = 10 percent APR for eight years Fuel 1. $2.00 per gallon for diesel 2. PUD tractors = five miles per gallon 3. LH tractors = 4.5 miles per gallon Labor Cost 1. PUD drivers = $25 per hour 2. Dock handlers = $22 per hour 3. LH drivers = $25 per hour Miscellaneous 1. Terminal variable cost per shipment at both origin and destination = $1.50 2. Terminal fixed cost per shipment at both origin and destination = $2.50 3. PUD equipment maintenance cost = $.35 per mile 4. LH equipment maintenance cost = $.35 per mile 5. PUD equipment insurance cost = $.23 per mile 6. LH equipment insurance cost = $.23 per mile 7. Billing cost = $1.95 per bill 8. Equipment is available 365 days, 24 hours per day 9. Administrative/overhead cost = 10 percent of total cost of move The line-haul tractor/trailer departs from the Altoona terminal at 2300 EST on June 1 and arrives at the Cleveland break-bulk terminal, which is approximately 220 miles from the Altoona satellite, at 0400 EST on June 2. The shipment moves from the line-haul trailer across the dock to a PUD city tractor/trailer unit in 30 minutes. The shipment is delivered to the Cleveland consignee by the PUD driver in a PUD city tractor/trailer unit on June 2 as one of 12 stops made by the driver over the period 0830 EST to 1800 EST. The stops covered a total of 55 miles in the Cleveland area. This shipment is one of five delivered to this particular consignee by the driver. Pickup hrs miles hrs Information Sheet (LTL costing) Unit Values Time Distance Dock time Line-haul Time Distance Dock time Delivery Time Distance hrs miles hrs hrs miles Depreciation PUD Tractor PUD Trailer LH Tractor LH Trailer PUD Tractor PUD Trailer LH Tractor LH Trailer PUD LH per day per day per hr per hr per day per day per hr INFORMATION Price PUD Tractor PUD Trailer LH Tractor LH Trailer Depreciation PUD Tractor PUD Trailer LH Tractor LH Trailer Interest APR Fuel Price per gallon PUD MPG LH MPG Labor ($/hr) PUD driver Dock handler LH driver Terminal Var cost per unit fixed cost per unit Maintenance PUD (per mile) LH (per mile) Insurance PUD (per mile) LH (per mile) Billing per bill Admin/overhead as % of cost shipment weight (cwt) Interest per hr Fuel per mile per mile LTL Costa Table Types of costs 1. Pick up Route costs Depreciation Tractor Trailer Tractor Interest Trailer Fucl Maintenance Insurance Subtotal #of steps Cost per stop # shipments at stop Route cost per shipment Shipment costs Billing Terminal variable cost Terminal fixed cost Dock Total pickup cost per shipment 2. Line-haul Depreciation Tractor Trailer Interest Tractor Trailer Fuel Labor Maintenance Total line-haul full trailer % capacity occupied by shipment Shipment line-haul cost 3. Delivery Route costs Depreciation Tractor Trailer Interest Trailer Fuel Labor Maintenance Insurance Subtotal # of stops Cost per stop shipments at stop Route cost per shipment Shipment costs Terminal variable cost Terminal fixed cost Deck Total delivery cost per shipment Total cost per Shipment Pickup, dock Line-haul, delivery Administrative Total Cost per Shipment Total cost per cwt LTL Costing Exercise Equipment Cost Data Your task is to calculate the cost of this shipment and determine what is the minimum rate that the carrier should charge for this shipment per hundred weight (cwt). The shipment consists of 25 cartons, each weighing 30 pounds and measuring 15 cubic feet. The carrier's trailers have a weight capacity of 40,000 pounds and 2,880 cubic feet. This shipment then occupies 1.875 percent of the trailer's weight capacity and 13 percent of its cubic capacity. Because the cubic feet requirement is greater, it will be used to allocate costs in the line-haul. Route and Time of Movement The shipment is picked up by the carrier's driver in a pickup and delivery (PUD) city tractor/trailer unit on June 1, 2005, as one of 18 stops made by the driver that day from 0730 EST to 1730 EST. The stops covered a total of 40 miles within the Altoona, Pennsylvania satellite terminal service area. The shipment was one of three handled by the carrier at this particular shipper's location. Once the pickup vehicle returns to the Altoona terminal, it takes 30 minutes to move the shipment from the city unit across the dock to the line-haul trailer. Equipment Purchase Price 1. PUD tractor -S43,600 2. LH tractor - $65,000 3. PUD trailer - $14,000 4. LH trailer - $19.000 Depreciation 1. Tractors = five-year straight line 2. Trailers = eight-year straight line Interest 1. Tractors = 10 percent APR for five years 2. Trailers = 10 percent APR for eight years Fuel 1. $2.00 per gallon for diesel 2. PUD tractors = five miles per gallon 3. LH tractors = 4.5 miles per gallon Labor Cost 1. PUD drivers = $25 per hour 2. Dock handlers = $22 per hour 3. LH drivers = $25 per hour Miscellaneous 1. Terminal variable cost per shipment at both origin and destination = $1.50 2. Terminal fixed cost per shipment at both origin and destination = $2.50 3. PUD equipment maintenance cost = $.35 per mile 4. LH equipment maintenance cost = $.35 per mile 5. PUD equipment insurance cost = $.23 per mile 6. LH equipment insurance cost = $.23 per mile 7. Billing cost = $1.95 per bill 8. Equipment is available 365 days, 24 hours per day 9. Administrative/overhead cost = 10 percent of total cost of move The line-haul tractor/trailer departs from the Altoona terminal at 2300 EST on June 1 and arrives at the Cleveland break-bulk terminal, which is approximately 220 miles from the Altoona satellite, at 0400 EST on June 2. The shipment moves from the line-haul trailer across the dock to a PUD city tractor/trailer unit in 30 minutes. The shipment is delivered to the Cleveland consignee by the PUD driver in a PUD city tractor/trailer unit on June 2 as one of 12 stops made by the driver over the period 0830 EST to 1800 EST. The stops covered a total of 55 miles in the Cleveland area. This shipment is one of five delivered to this particular consignee by the driver. Pickup hrs miles hrs Information Sheet (LTL costing) Unit Values Time Distance Dock time Line-haul Time Distance Dock time Delivery Time Distance hrs miles hrs hrs miles Depreciation PUD Tractor PUD Trailer LH Tractor LH Trailer PUD Tractor PUD Trailer LH Tractor LH Trailer PUD LH per day per day per hr per hr per day per day per hr INFORMATION Price PUD Tractor PUD Trailer LH Tractor LH Trailer Depreciation PUD Tractor PUD Trailer LH Tractor LH Trailer Interest APR Fuel Price per gallon PUD MPG LH MPG Labor ($/hr) PUD driver Dock handler LH driver Terminal Var cost per unit fixed cost per unit Maintenance PUD (per mile) LH (per mile) Insurance PUD (per mile) LH (per mile) Billing per bill Admin/overhead as % of cost shipment weight (cwt) Interest per hr Fuel per mile per mile LTL Costa Table Types of costs 1. Pick up Route costs Depreciation Tractor Trailer Tractor Interest Trailer Fucl Maintenance Insurance Subtotal #of steps Cost per stop # shipments at stop Route cost per shipment Shipment costs Billing Terminal variable cost Terminal fixed cost Dock Total pickup cost per shipment 2. Line-haul Depreciation Tractor Trailer Interest Tractor Trailer Fuel Labor Maintenance Total line-haul full trailer % capacity occupied by shipment Shipment line-haul cost 3. Delivery Route costs Depreciation Tractor Trailer Interest Trailer Fuel Labor Maintenance Insurance Subtotal # of stops Cost per stop shipments at stop Route cost per shipment Shipment costs Terminal variable cost Terminal fixed cost Deck Total delivery cost per shipment Total cost per Shipment Pickup, dock Line-haul, delivery Administrative Total Cost per Shipment Total cost per cwt