Ram Roy's firm has developed the following supply, demand, cost, and inventory data. Allocate production capacity to meet demand at a minimum cost using the transportation method. What is the cost? Assume that the initial inventory has no holding cost in the first period and backorders are not permitted.
Supply Available
|
Period
|
Regular Time
|
Overtime
|
Subcontract
|
Demand Forecast
|
|
1
|
30
|
10
|
5
|
40
|
|
2
|
35
|
12
|
5
|
50
|
|
3
|
30
|
10
|
5
|
40
|
|
Initial inventory
|
20 units
|
|
Regular-time cost per unit
|
$100
|
|
Overtime cost per unit
|
$150
|
|
Subcontract cost per unit
|
$200
|
|
Carrying cost per unit per month
|
$4
|