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    Tashtego

    Uploaded by

    Phuong Bogrand
    This document compares the costs and profits of two ships, the Tashtego and a larger vessel, on a trip between Balik Papan and Singapore transporting tapioca. It finds that using the Tashtego results in higher annual profit of $101,373.50 compared to $86,969 if the larger vessel is used instead. The larger vessel has higher variable costs due to stopping twice and paying higher portage fees. It also has different fixed costs for insurance, depreciation, and salaries. Therefore, the document concludes it was a good investment decision for the company to use the Tashtego rather than the larger vessel on this route.

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    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd

    Tashtego

    Uploaded by

    Phuong Bogrand
    4K views3 pages
    This document compares the costs and profits of two ships, the Tashtego and a larger vessel, on a trip between Balik Papan and Singapore transporting tapioca. It finds that using the Tashtego results in higher annual profit of $101,373.50 compared to $86,969 if the larger vessel is used instead. The larger vessel has higher variable costs due to stopping twice and paying higher portage fees. It also has different fixed costs for insurance, depreciation, and salaries. Therefore, the document concludes it was a good investment decision for the company to use the Tashtego rather than the larger vessel on this route.

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    Interaction between problem definition and relevant cost analysis

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    This document compares the costs and profits of two ships, the Tashtego and a larger vessel, on a trip between Balik Papan and Singapore transporting tapioca. It finds that using the Tashtego results in higher annual profit of $101,373.50 compared to $86,969 if the larger vessel is used instead. The larger vessel has higher variable costs due to stopping twice and paying higher portage fees. It also has different fixed costs for insurance, depreciation, and salaries. Therefore, the document concludes it was a good investment decision for the company to use the Tashtego rather than the larger vessel on this route.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    4K views3 pages

    Tashtego

    Uploaded by

    Phuong Bogrand
    This document compares the costs and profits of two ships, the Tashtego and a larger vessel, on a trip between Balik Papan and Singapore transporting tapioca. It finds that using the Tashtego results in higher annual profit of $101,373.50 compared to $86,969 if the larger vessel is used instead. The larger vessel has higher variable costs due to stopping twice and paying higher portage fees. It also has different fixed costs for insurance, depreciation, and salaries. Therefore, the document concludes it was a good investment decision for the company to use the Tashtego rather than the larger vessel on this route.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 3

    Tashtego Singapore Balik Papan Tashtego trip Revenue Trip cost Portage dues : .14 * 4500 tons * 2.

    .5 days = 1575 Lighthouse: 73 Cargo Costs Lighterage: .25 * 3150 = Stevedoring .56 * 3150 = Bunkering .73 * 960 sea miles * .5 Total Cost Total Cost/ Ton Contribution Profit / Ton Balik Papan Singapore Tashtego trip Revenue Trip Cost Portage dues .2 *1day * 4500 tons = Lighthouse Cargo Cost Lighterage .16* 3950 = Stevedoring .32 * 3950 = Cranage .14 * 3950 = Bunkering Total Cost Total Cost / Ton Contribution Profit/Ton 900 126 5.1 787.5 1764 =350.4 4549.9 1.444 1.256 2.7

    632 1264 553 350.4 3825.4 .9685 4.132

    Tashtego one round trip Revenue Balik Papan Singapore 5.1 * 3950 = 20145 Singapore Balik Papan 2.7 * 3150 = 8505 Trip Cost Portage Dues Singapore 900 Balik Papan 1575 Lighthouse Singapore 126 Balik Papan 73 Cargo Cost Lighterage Singapore 632 Balik Papan 787.5 Stevedoring Singapore 1264 Balik Papan 1764 Cranage 553 Burkering Cost 700.8 Total Cost Contribution profit/round Contribution profit/ year 20274.7 * 50 Large Vessel Round Trip Revenue Balik Papan Singapore 6850*5.1 = 34935 Singapore Balik Papan 0 Trip Cost Portage Dues Singapore (.2 * 1*12500) = 2500 Balik Papan (.14 *3*12500) = 5250 Lighthouse Singapore (126 *2times) = 252 Balik Papan = 73 Special Assessment = 4000 Cargo Cost Lighterage Singapore (.16*6850)= 1096 Balik Papan 0

    28650

    8375.3 20274.7 1013735

    34935

    Stevedoring Singapore (.32 *6850) = 2192 Balik Papan 0 Cranage (.14*6850) =959 Bunkering (1.27*960) = 1219.2 Total Cost Contribution profit/Round Contribution Profit/ year

    17541.2 17393.8 869690

    If Tashtego is replaced by large Vessel, the profit is displayed below: Revenue Balik Papan Singapore 20145 Singapore Balik Papan 8505 Trip Cost Portage Dues Singapore (2 times) 5000 Balik Papan 5250 Lighthouse Singapore 73 Balik Papan 252 Special Assessment 4000 Cargo Cost Lighterage Singapore (.16*3950)= 632 Balik (.25*3150 )= 787.5 Stevedoring Singapore .32 *3950 = 1264 Balik .56 * 3950 = 1764 Cranage .14*3950 = 553 Bunkering Cost 1.27 * 960 = 1219.2 Total Cost Contribution Profit / Round

    28650

    20794.7 7855.3

    Conclusion: If the company uses the large vessel instead of Tashtego, the profit will drop to $ 7855.3 instead of $ 20274.7. There are some variable cost increasing when using the big ship like stopping 2 times (one before and one after Singapore), and also the postage due increasing because of the large ship. Beside this, fixed costs are also different between the Tashtego and Large vessel. For example: insurance, depreciation, employee salaries At the result, the company should use the Tashtego on the tapioca round instead of the Africa. The purchase of Tashtego was a good investment decistion.

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