Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Richard's Sporting Goods needs to fill an online order for 144 hockey sticks. The manager is considering shipping the order by truck to the customer
Richard's Sporting Goods needs to fill an online order for 144 hockey sticks. The manager is considering shipping the order by truck to the customer in Wisconsin, at a carrier charge of $75. The delivery will take five days and the order is paid on delivery (Richard's doesn't get paid until the sticks are received). The hockey sticks are valued at $50 for each stick and Richard's uses a 25 percent annual inventory carrying charge. a. Use the formula Total Cost = in-transit holding cost + freight cost. Note: the term "transit inventory cost" is used interchangeably with "in-transit holding cost". What will be the total cost of the shipment? (Use 365 days in a year. Do not round intermediate calculations. Round your answers to 2 decimal places.) b-1. If the shipment could be delivered in only 2 days at a cost of $100, then what will be the total cost? (Use 365 days in a year. Do not round intermediate calculations. Round your answer to 2 decimal places.) b-2. If the manager chose the above option, how much money would be saved or lost? (Round your answer to 2 decimal places.)
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started