An automobile company manufactures XYZ parts in two plant, which are Dallas and Houston. The daily production
Question:
An automobile company manufactures XYZ parts in two plant, which are Dallas and Houston. The daily production capacities at Dallas and Houston are 1000 and 2000, respectively. Products are shipped by freight to the final assembly line located in Detroit and New Mexico. Each car needs 4 parts to be assembled with the final product. The final assembly line in Detroit and New Mexico produces 200 and 400 cars per day, respectively. The order-placement cost for Dallas manufacturing plant is $4000 to produce the ABC part, while the starting cost is $5500 for Houston plant. Because of the tolls between the states. the company believes that it may be cheaper to first freight some products to Chicago or New York and then ship the products to their final destinations. The toll charges for passing throw cities are shown in the table below:
Federal Taxation 2016 Comprehensive
ISBN: 9780134104379
29th edition
Authors: Thomas R. Pope, Timothy J. Rupert, Kenneth E. Anderson