A Shipment of Parts Valued at $75,000 Needs to Be

question 55

Essay

A shipment of parts valued at $75,000 needs to be shipped from Tampa,FL,to Chicago,IL.They could be shipped by rail,taking 15 days at a cost of $1,575,or by truck,taking 4 days at a cost of $2,640.The annual holding cost rate for this type of item has been estimated at 22%.What option is more economical?

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Definitions:

Journal Entries

The recording of financial transactions into the accounting records, specifying the accounts affected by those transactions.

Standard Format

A predefined layout or structure used to present data or information consistently.

Office Equipment

Assets such as computers, desks, and chairs used in an office environment to support business operations.

Posting

The process of transferring entries from a journal into the respective accounts in the ledger.