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Exhibit 74
the Following Questions Are Based on the Problem Below

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Exhibit 7.4
The following questions are based on the problem below.
Robert Gardner runs a small,local-only delivery service.His fleet consists of three smaller panel trucks.He recently accepted a contract to deliver 12 shipping boxes of goods for delivery to 12 different customers.The box weights are: 210,160,320,90,110,70,410,260,170,240,80 and 180 for boxes 1 through 12,respectively.Since each truck differs each truck has different load capacities as given below:
 Truck Weight Capacity  Box Capacity  Cost per pound 1800 pounds 5$0.342900 pounds 6$0.423700 pounds 4$0.25\begin{array}{llll}\text { Truck} & \text { Weight Capacity } & \text { Box Capacity } & \text { Cost per pound }\\\hline 1 & 800 \text { pounds } & 5 & \$ 0.34 \\2 & 900 \text { pounds } & 6 & \$ 0.42 \\3 & 700 \text { pounds } & 4 & \$ 0.25\end{array} Robert would like each truck equally loaded,both in terms of number of boxes and in terms of total weight,while minimizing his shipping costs.Assume a cost of $50 per item for trucks carrying extra boxes and $0.10 per pound cost for trucks carrying less weight.
The following integer goal programming formulation applies to his problem.
Y1 = weight loaded in truck 1;Y2 = weight loaded in truck 2;Y3 = weight loaded intruck3;Xi,j = 0 if truck i not loaded with box j;1 if truck i loaded with box j.
Given the following spreadsheet solution of this integer goal programming formulation,answer the following questions.
 Exhibit 7.4 The following questions are based on the problem below. Robert Gardner runs a small,local-only delivery service.His fleet consists of three smaller panel trucks.He recently accepted a contract to deliver 12 shipping boxes of goods for delivery to 12 different customers.The box weights are: 210,160,320,90,110,70,410,260,170,240,80 and 180 for boxes 1 through 12,respectively.Since each truck differs each truck has different load capacities as given below:   \begin{array}{llll}\text { Truck} & \text { Weight Capacity } & \text { Box Capacity } & \text { Cost per pound }\\ \hline 1 & 800 \text { pounds } & 5 & \$ 0.34 \\ 2 & 900 \text { pounds } & 6 & \$ 0.42 \\ 3 & 700 \text { pounds } & 4 & \$ 0.25 \end{array}  Robert would like each truck equally loaded,both in terms of number of boxes and in terms of total weight,while minimizing his shipping costs.Assume a cost of $50 per item for trucks carrying extra boxes and $0.10 per pound cost for trucks carrying less weight. The following integer goal programming formulation applies to his problem. Y<sub>1 </sub>= weight loaded in truck 1;Y<sub>2 </sub>= weight loaded in truck 2;Y<sub>3 </sub>= weight loaded intruck3;X<sub>i,j </sub>= 0 if truck i not loaded with box j;1 if truck i loaded with box j. Given the following spreadsheet solution of this integer goal programming formulation,answer the following questions.    -Refer to Exhibit 7.4.The spreadsheet model has scaled all the weights from pounds into 100s pounds.How does this scaling effect the solution obtained using the Risk Solver Platform RSP)?
-Refer to Exhibit 7.4.The spreadsheet model has scaled all the weights from pounds into 100s pounds.How does this scaling effect the solution obtained using the Risk Solver Platform RSP)?

Analyze the effects of manufacturing overhead variances on financial performance.
Calculate and explain the significance of the denominator activity level in overhead rate determination.
Understand the calculation of variable and fixed components of the predetermined overhead rate.
Calculate variable overhead rate variance and efficiency variances.

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