There are currently 5 docks at the UPS port facility and it takes 3.7 hours to process a truck. The facility operates 15 hours a day 365 days a year. During a year they expect 4500 trucks. The current operational costs are $56K per dock per year. The waiting costs are estimated at $80 per day. UPS wants to determine if eliminating one dock will reduce or increase total costs. Answer the following. Complete all calculations with at least 2 decimal points. What is the arrival rate per day? What are the WCe when there are 5 docks? What are the RCe when there are 5 docks? What are the ICe when there are 4 docks? How many docks should UPS have to minimize total costs?

There are currently 5 docks at the UPS port facility and it takes 3.7 hours to process a truck. The facility operates 15 hours a day 365 days a year. During a year they expect 4500 trucks. The current operational costs are $56K per dock per year. The waiting costs are estimated at $80 per day. UPS wants to determine if eliminating one dock will reduce or increase total costs. Answer the following. Complete all calculations with at least 2 decimal points. What is the arrival rate per day? What are the WCe when there are 5 docks? What are the RCe when there are 5 docks? What are the ICe when there are 4 docks? How many docks should UPS have to minimize total costs?

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter8: Tactical Decision-making And Relevant Analysis

Section: Chapter Questions

Problem 54P

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