Question

shipped FOB Shipping Point to your facility via motor carrier (TL) at a rate of $155 per load. After arriving at your facility, you've calculated receiving and quality costs at $6.00 per pallet. You estimate that 1.5% of the truckload of oranges will spoil and 1% will be wasted in transport. The administrative costs to successfully manage the relationship between LB Family Farms and your organization are estimated to be approximately 4% of the value of a truckload of shipped oranges. Each case of oranges is 25 pounds, with 40 cases per pallet and 25 pallets per truckload. Naranja International, located in South Africa, offers oranges at a purchase price of $1.03 per pound. First, the oranges need to be shipped to the USA via waterway. The ocean freight costs are $3,500 per container and the import duties from South Africa are 3% of the value of shipped oranges. Once arriving at the port of Long Beach, California, drayage costs are \$275 per container. You momentarily store the oranges at a local warehouse at a rate of $6.00 per pallet. The container is picked up the next day and travels intermodal (through a motor carrier) to your facility at a cost of $160 per container. Upon arrival at your facility, you've calculated costs of $6.00 per pallet for receiving and quality. Based on historical averages, 2% of your container of oranges will spoil and 3% will be wasted in transport. The administrative costs to successfully manage a relationship between your organization and Naranja International are estimated at 9% of the value of a container of shipped oranges. These costs account for the intricacies of dealing with an offshored supplier on a different continent, with a different language and culture than what is found at Smoothie City headquarters. Each case of oranges is 25 pounds, with 40 cases per pallet and 15 pallets per container. Using the data from the "INFORMATION" sheet, you will input cost informa tion for both Naranja International and LB Family Farms. First, put given Units \& Ratios information into the tables. Use formulas to fill out the remainder of the Units \& Ratios tables. For example, multiply the weight per case by the number of cases per pallet to find the weight per pallet. Next, input cost information in the "Costs Given" columns. You are given costs in all different units. You must standardize the units to analyze the data. Write functions to palletize the costs. For example, if you're given cost per pound, write a function to multiply that cost by number of pounds in a pallet. Sum your palletized costs to find TLC per pallet. Write formulas to find TLC per container and TLC per pound. After completing calculations, complete the assignment on the "QUESTIONS" sheet.

Answer 1

The question requires a comprehensive cost analysis comparing two suppliers of oranges, including transportation, spoilage, waste, and administrative costs, to determine the total landing cost per pallet, per container, and pound.

Step-by-step explanation:

This question involves a detailed cost analysis of shipping oranges from two different suppliers to a facility, including various costs associated with each step of the transport and handling process. The student is tasked with calculating the total landing cost (TLC) per pallet, per container, and per pound to compare the suppliers. This requires setting up tables for units & ratios and performing calculations to palletize and standardize costs.

To begin, one would calculate the weight per pallet by multiplying the weight per case of oranges by the number of cases per pallet. Costs given in different units such as per pound or load need to be converted to per pallet to enable comparisons. The calculated spoilage and waste percentages, as well as administrative costs as a percentage of value, will be factored into these costs to determine the TLC.