1. TRANSPORTATION ALGORITHM
STRATEGIC
RESOURCE
ALLOCATION
and
PLANNING
MGMT E-5050
Finnish Furniture
TRANSPORTATION ALGORITHM
Homework Solution

2. Finnish Furniture Finnish Furniture manufactures tables in facilities
located in 3 cities - Reno, Denver, and Pittsburgh.
The tables are then shipped to 3 retail stores loca-
ted in Phoenix, Cleveland, and Chicago.
Management wishes to develop a distribution sche-
dule that will meet the demands at the lowest possi-
ble cost.
The shipping cost per unit from each of the sources
to each of the destinations is shown in the following
table:

3. Finnish Furniture from / to Phoenix Cleveland Chicago Reno 10 16 19
Denver 12 14 13
Pittsburgh 18
The available supplies are:
120 units from Reno
200 units from Denver
160 units from Pittsburgh
The store demands are;
140 units from Phoenix
160 units from Cleveland
180 units from Chicago
REQUIREMENT:
How many units should be
shipped from each facility
to each of the retail stores
if cost is to be minimized?
2. What is the total cost?

4. Finnish Furniture Finnish Furniture has experienced a decrease in the
demand for tables in Chicago; demand has fallen to
150 units.
REQUIREMENT:
What special condition would exist?
What is the minimum cost solution?
Will there be any units remaining at any of the
manufacturing facilities?