Answer:
Henderson = $1,200
Central States = $1,000
Based on the calculations, Central States Railroad is better at a lower cost than Henderson
Explanation:
The question is to do an evaluation of the costs of use Henderson Bulk Trucking Company or the Central States Railroad
Step 1) Determine the cost of using Henderson
What is the cost per tank truck = $600
What is the capacity in gallons = 700 galloons
However, since XYZ Chemical needs to ship 9,600 gallons, it means it will make use of 2 trucks from Henderson as follows
The cost of Henderson Bulk Trucking = $600 x 2 = $1,200
Step 2) Determine the cost of using Central Railroad
What is the cost per tank truck = $1000
What is the capacity in gallons = 23,500 galloons
since XYZ Chemical needs to ship 9,600 gallons, it means it will make use of only one of the trucks
The cost of Central Roilroad= $1000 x 1 = $1,000
Based on the calculations, Central States Railroad is better at a lower cost than Henderson
