Introduction to Materials Management 8th Edition by Steve Chapman ,Tony Arnold ,Ann Gatewood ,Lloyd Clive

Exercise 9

A company has a central supply facility and a distribution center located 400 miles away. The central supply product cost is $75, TL transportation rates from central supply to the DC are $60 per unit, and handling costs at the DC are $4 per unit. Calculate the market boundary location and the laid-down cost at the market boundary. LTL rates are $2 per unit per mile.