1. Review for Exam 1 Case 6-1 pages 205-210
Send 17,000 lbs of arch supports from St. Jo to Green Bay.
By rail:
UFC Item Boot or shoe arch supports
LCL rating 100
CL rating 70 (over 20,000 lbs)
Freight Tariff Rate Bases:St. Jo to Green Bay
579 Class Rates
at LCL 349 cents per cwt

2. Case 6-1 Cont’d Should we ship “wind”? at LCL 349 cents per cwt
349 cents/cwt = $3.49/cwt
17,000 lbs = 170 cwt
$3.49*170 = $593.30
Should we ship “wind”?
at CL 244 cents per cwt
244 cents/cwt = $2.44/cwt
20,000 lbs = 200 cwt
$2.44*200 = $488

3. Case 6-1 Cont’d Interest Rate 15%/year $21,000 value LCL takes 10 days
4 days interest on $21,000
15%/365*21000 = $8.63 daily interest
4 days interest is $34.52

4. Use Truck? $0.85/mile 588 miles 2 days Cost to Green Bay = $499.80
Saves additional 4 days interest or $34.52
So the relative cost is $ which is less than CL
But…?

5. From St. Louis Freight Tariff Rate Bases:St. Louis to Green Bay
458 Class Rates
at LCL 307 cents per cwt
307 cents/cwt = $3.07/cwt
17,000 lbs = 170 cwt
$3.07*170 = $521.90

6. Case 6-1 Cont’d Should we ship “wind”? at CL 215 cents per cwt
215 cents/cwt = $2.15/cwt
20,000 lbs = 200 cwt
$2.15*200 = $430