Bindley Corporation has a one-year contract to supply motors for all washing machines produced by Rinso Ltd. Rinso manufactures the washers at four locations around the country: New York City, Fort Worth, San Diego, and Minneapolis. Plans call for the following numbers of washing machines to be produced at each location: New York City Fort Worth San Diego Minneapolis 50,000 70,000 60,000 80,000

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Operations Management

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Bindley Corporation has a one-year contract to supply motors for all washing machines produced by Rinso Ltd. Rinso manufactures the
washers at four locations around the country: New York City, Fort Worth, San Diego, and Minneapolis. Plans call for the following
numbers of washing machines to be produced at each location:
New York City
Fort Worth
50,000
70,000
San Diego
60,000
80,000
Minneapolis
Bindley has three plants that can produce the motors. The plants and production capacities are
Boulder
Macon
Gary
Due to varying production and transportation costs, the profit Bindley earns on each 1,000 units depends on where they were
produced and where they were shipped. The following table gives the accounting department estimates of the dollar profit per unit.
(Shipment will be made in lots of 1,000.)
PRODUCED AT
Boulder
Macon
Gary
100,000
100,000
150,000
From/To
Boulder
Macon
Gary
Requirements
NEW YORK CITY
7
20
8
SHIPPED TO
FORT WORTH
11
17
18
Given profit maximization as a criterion, Bindley would like to determine how many motors should be produced at each plant and how
many motors should be shipped from each plant to each destination.
a. Develop a transportation grid for this problem.
SAN DIEGO
8
12
13
New York City Fort Worth
MINNEAPOLIS
13
10
16
San Diego
Minneapolis Supply
Transcribed Image Text:Bindley Corporation has a one-year contract to supply motors for all washing machines produced by Rinso Ltd. Rinso manufactures the washers at four locations around the country: New York City, Fort Worth, San Diego, and Minneapolis. Plans call for the following numbers of washing machines to be produced at each location: New York City Fort Worth 50,000 70,000 San Diego 60,000 80,000 Minneapolis Bindley has three plants that can produce the motors. The plants and production capacities are Boulder Macon Gary Due to varying production and transportation costs, the profit Bindley earns on each 1,000 units depends on where they were produced and where they were shipped. The following table gives the accounting department estimates of the dollar profit per unit. (Shipment will be made in lots of 1,000.) PRODUCED AT Boulder Macon Gary 100,000 100,000 150,000 From/To Boulder Macon Gary Requirements NEW YORK CITY 7 20 8 SHIPPED TO FORT WORTH 11 17 18 Given profit maximization as a criterion, Bindley would like to determine how many motors should be produced at each plant and how many motors should be shipped from each plant to each destination. a. Develop a transportation grid for this problem. SAN DIEGO 8 12 13 New York City Fort Worth MINNEAPOLIS 13 10 16 San Diego Minneapolis Supply
b. Find the optimal solution using Microsoft Excel. (Note: Due to existing transportation contracts, Macon must ship 50,000 motors to
Fort Worth and 0 motors to San Diego. These requirements are already shown in the Candidate Solution below.)
Note: Leave the cells blank, whenever zero (0) is required.
Candidate Solution
Boulder
Macon
Gary
Total supplied
Profit
Boulder
Macon
Gary
Total profit
New York City
0
New York City Fort Worth
Fort Worth
50,000
50,000
San Diego
San Diego
0
Minneapolis
Minneapolis
$
0
Total Shipped
0
0
50,000
50,000
Transcribed Image Text:b. Find the optimal solution using Microsoft Excel. (Note: Due to existing transportation contracts, Macon must ship 50,000 motors to Fort Worth and 0 motors to San Diego. These requirements are already shown in the Candidate Solution below.) Note: Leave the cells blank, whenever zero (0) is required. Candidate Solution Boulder Macon Gary Total supplied Profit Boulder Macon Gary Total profit New York City 0 New York City Fort Worth Fort Worth 50,000 50,000 San Diego San Diego 0 Minneapolis Minneapolis $ 0 Total Shipped 0 0 50,000 50,000
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