FedEx My Company if FedEx Express, the Essay

Excerpt from Essay :

FedEx

My company if FedEx Express, the overnight courier company. The activity that is being studied is the foot courier division, a hypothetical transaction that involves an envelope picked up by a foot courier and shipped domestically. The costs associated with this transaction are primarily allocated to the pick-up side; the delivery side is treated as a fixed cost to the delivering station. Indeed, most of the costs associated with this transaction are fixed costs, once the envelope enters the network on the airplane. Prior to that point, the courier is one cost, reflecting the total costs of the route, and the station is another cost, reflecting the aggregate costs associated with multiple couriers and routes.

The company publishes data for FedEx Express, as follows:

FedEx Express

Q1 YTD

Revenue

Salaries & Benefits

Transportation

Rentals/Landing Fees

Dep/Amort

Fuel

Maintenance & Repairs

Intercompany charges

Other

Operating Income

There remain costs that are not allocated, mostly pertaining to the corporate overhead expenses of running the parent company, FedEx Corp. If these costs are allocated by share of revenue, FedEx Express would receive 64.3% of these costs. The unallocated costs are as follows (estimates only):

Unallocated Costs

Corporate Management

IT infrastructure

Interest

Total

Express share

61.728

This gives a…

Sources Used in Document:

Works Cited:

FedEx Corporate Q1 Fiscal 2009 statistics. FedEx Corporation. Retrieved April 28, 2012 from http://www.FedEx.com/us/investorrelations/Q1FY09_stat_book.pdf

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