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A jeweler has a distribution center in Atlanta (3-Digit ZIP…

Posted byAnonymous February 24, 2025February 24, 2025

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A jeweler hаs а distributiоn center in Atlаnta (3-Digit ZIP 303) and a stоre in Saint Augustine, Flоrida (3-Digit ZIP 320). The USPS categorizes shipments from 3-Digit ZIP 303 to 3-Digit ZIP 320 as Zone 3 shipments. The store in Saint Augustine sells $1,000,000 worth of goods (valued at cost of goods) and the average value per pound of the company's goods is $1,000/lb.  The company uses a 15% inventory holding cost.  Ignore inventory investment in shipping at the DC -- the USPS picks up from the DC on a schedule independent of the shipment size.  Question: From a purely financial perspective, what is the ideal shipment size in pounds per shipment to the store in Saint Augustine using the USPS as the carrier?  Download Table 1 to find the postage costs per package based on the weight of the package and the Zone of the shipment.  Remember there are 16 ounces in a pound and note that Table 1 includes first, weight ranges by ounce and then weight ranges by pound.  Table 1: Postage Costs per package based on Weight and Zone.

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Tags: Accounting, Basic, qmb,

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