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Question 2 [ 2 0 Marks A company has signed the following contract to supply customers A and B for the next 3 months. June

Question 2
[20 Marks A company has signed the following contract to supply customers A and B for the next 3 months. June July 20 Customer A Customer B 3020 August 151020 They can produce 40 units per month at a cost of 100 per unit on regular time and an additional 10 units per month on overtime at a cost of 120 per unit. They can store units at a cost of 10 per unit per month. The contract allows the company to fall short on its supply commitment to customer A during the months of June and July, but this incurs a penalty cost of 5 per unit; however, all shipments are to be completed by August. No shortages are allowed for customer B and his demands must be satisfied on the months specified. The company wishes to determine the optimal production schedule that will minimize the total cost of production, storage, and shortage. Formulate this as a transportation probelm by constructing the transportation table

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