Companies A, B, and C Supply Components to Three Plants

question 13

Essay

Companies A, B, and C supply components to three plants (F, G, and H) via two crossdocking facilities (D and E). It costs $4 to ship from D regardless of final destination and $3 to ship to E regardless of supplier. Shipping to D from A, B, and C costs $3, $4, and $5, respectively, and shipping from E to F, G, and H costs $10, $9, and $8, respectively. Suppliers A, B, and C can provide 200, 300 and 500 units respectively and plants F, G, and H need 350, 450, and 200 units respectively. Crossdock facilities D and E can handle 600 and 700 units, respectively. Logistics Manager, Aretha Franklin, had previously used "Chain of Fools" as her supply chain consulting company, but now turns to you for some solid advice.
-What is the complete linear model for this scenario?

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Definitions:

Operating Income

The income generated from the core operations of a business, excluding costs and expenses like taxes and interest payments.

Direct Materials Price Variance

Direct materials price variance refers to the difference between the actual cost of materials used in production and the standard cost expected for those materials.

Data Collected

Information gathered from various sources used for analysis, decision-making, or reporting in a wide array of contexts.

Variable Costs

Expenses that vary in relation to the amount of activity or the quantity of output produced.