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Bsop 434 Week 2 Lab Answers Essay example

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Week 2 Lab

|Step 1: First Year Costs | |

Question 1: What would the first-year costs be to AML if it purchased the 10 used 20-foot containers? How long would it take to recoup the investment, assuming that the mushroom traffic continued?
Based on 120 container shipments per year with 10% loads return or 12 containers, this would generate revenues equal to the associated cost.
Looking at the charts below the proposed service would actually lose money as the investment of $255.350 can’t be gained back. Investment cost would be 10 containers X 7 which equals 70. Re-equipping of 5 flatcars X 9 would equal 45. For a total …show more content…

How long would it take to recoup the investment, assuming that the mushroom traffic continued?
With 60 container shipments per year 10% or return loads or 6 containers would generate revenues equal to the associated cost.
Looking below the service would generate an annual profit of $56,970 with a payback time of approximately 5.1 years.
|Cost Category |Monthly Cost |Annual Cost |
|Inbound transportation |15,500 |186,000 |
|Outbound transportation |7,750 |93,000 |
|Maintenance | |0 |
|Energy |

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