User

The following supply, demand, cost, and inventory data $($provided below$)$ has been made available to you by the CEO. He has requested you to allocate production capacity for P&G to meet demand at minimum cost using the transportation method. Determine the cost of the plan. Assuming the initial inventory has no holding cost in the first period and backorders are not permitted. Use the provided information to answer the questions.

Supply Available:

Period: $1$

Regular time: $30$

OVERTIME:$10$

SUBCONTRACT:$5$

DEMAND Forecast: $40$

Period: $2$

Regular time: $35$

OVERTIME:$12$

SUBCONTRACT:$5$

DEMAND Forecast: $50$

Period: $3$

Regular time: $30$

OVERTIME:$10$

SUBCONTRACT:$5$

DEMAND Forecast: $40$

Initial Inventory $=20$ units

Regular$-$time cost per unit $=$ R$100$

Overtime cost per unit $=$ R$150$

Subcontract cost per unit $=$ R$200$

Carrying cost per month $=$ R$4$