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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
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 60,000 68,000 99,000 84,000 Bindley has three plants that can produce the motors. The plants and production capacities are Boulder Macon Gary 115,000 116,000 124,000 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.) SHIPPED TO PRODUCED AT NEW YORK CITY FORT WORTH SAN DIEGO MINNEAPOLIS Boulder 14 10 12 14 Macon 18 20 19 16 Gary 23 11 22 18
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