Calculate cost per mile for only first year of operation

Assignment Help Operation Management

Reference no: EM132275436

You are the owner/operator of a small transportation enterprise. Your only semi-tractor, a 2010 White Freightliner in service for 3,160,888 miles, needs to be replaced. Downtime is reducing revenues, customer service is negatively impacted, and repair costs are mounting. You are evaluating two new tractors. The 2010 tractor will become a lawn ornament at a local university.

Factors:

Operating hours per day = 22

Operating days per week = 7

Weeks of operation per year = 50

Average miles per hour = 51.8

Projected fuel price per gallon = $3.30

Tractor A:

2019 White Freightliner; priced @ $169,000; EPA miles per gallon rating = 5.75; insurance per year = $7,900; routine annual maintenance = $28,000.

Tractor B:

2019 Volvo; priced @ $186,000; EPA miles per gallon rating = 6.8; insurance per year = $8,800; routine annual maintenance = $34,000.

Questions to be answered:

How many miles per year will the new tractor travel?

What are the total operating costs per year for each of the tractors being evaluated, including depreciation based upon 6 years (purchase price/6)?

What is the total cost per mile driven for each of the two tractors being evaluated? Calculate cost per mile for only the first year of operation.

Make a purchase choice between the 2 new tractors.

Reference no: EM132275436

Questions Cloud

How an organizations structure can shape the roles : MBA 200 :Review an article that describes how an organization's structure can shape the roles of a project manager and project team throughout the duration.

Write an evaluation of the patient apparent symptoms : Examine your colleague's transcript, and write an evaluation of the prospective patient's apparent symptoms and presenting problem(s) within the context.

Explain the role of teams and teamwork at zappos : Explain the role of teams and teamwork at Zappos? Consider the components of restaurant sustainability efforts

Explain threats to internal validity and external validity : Consider the threats to validity in quantitative research and explore strategies to mitigate these threats. You will also consider the ethical issues.

Calculate cost per mile for only first year of operation : What is the total cost per mile driven for each of the two tractors being evaluated? Calculate cost per mile for only the first year of operation.

Personal resources on a shared network : Would you still consider sharing any of your own personal resources on a shared network? Please justify your response.

An introduction to the concept of sustainability : An introduction to the concept of sustainability. A compelling case for Tie’s firm to pursue sustainability.

Occurrences method that computes number of times : For this assignment you will write the occurrences method that computes the number of times a target value occurs in a 2-dimensional array.

Advertising campaign-pros and cons to attaching an athlete : As with any advertising campaign, there are pros and cons to attaching a celebrity or athlete to a company or product - WHAT is your vision for these ads

User Account

All Pages