Ask Question, Ask an Expert

+61-413 786 465

info@mywordsolution.com

Ask Managerial Accounting Expert

Transportation model Table

A more compact method for representing the transportation model than the linear equations is to use what we call the transportation tableau. It is a matrix form with its rows symbolizing the sources and its columns the destinations. The cost element cij are summarized in the northeast corner of the matrix cell (i,j). This will be the basis for the development of a special simplex-based method for solving the transportation problem.

In some cases, the problem could be unbalanced because the total supply does not equal the total demand.

Where demand exceeds supply, a fictitious or dummy source (plant) can be added with its capacity equal to the difference. The cost of shipping will be 0. Physically, the amount shipped to a destination from a dummy plant will represent the shortage quantity at that destination. We may look at the situation differently, however, by saying that a penalty cost is incurred for every unsatisfied demand unit at the destination centers.  In this case the unit transportation cost will equal the unit penalty costs at the various destinations.

In a similar manner, if the supply exceeds the demand, we can add a fictitious or dummy destination that will absorb the difference. Any quantity shipped from a plant to a dummy destination represents a surplus quantity at that plant. The associated unit transportation cost is zero. However, we can charge a storage cost for holding these commodities at the plant, in which case the unit transportation cost will equal the unit storage cost.

At times we can find cells where we cannot allocate any unit due to physical constraints. In that case the transportation cost should be shown as M—being M a very high cost.

Managerial Accounting, Accounting

  • Category:- Managerial Accounting
  • Reference No.:- M9515962

Have any Question?


Related Questions in Managerial Accounting

Managerial accounting assignment -background you are

Managerial Accounting Assignment - Background: You are recently employed as a graduate consultant in a management consultancy firm and are assigned to a team. One of your firm's clients is currently evaluating its budget ...

Duncan arrowroot confectionery dacrequired in hard copy no

Duncan Arrowroot Confectionery (DAC) Required in hard copy no later than the class scheduled time on Thursday, October 18th. 1) Prepare a memo to the Controller explaining how you would go about classifying the various r ...

Managerial accounting group report performance measures

Managerial Accounting Group Report: Performance measures, remuneration and motivation Learning Outcomes - a) Analyse the roles of cost and management in organisations through the analysis of accounting concepts and tools ...

Corporate accounting assignment -question 1 - dr kelvin

Corporate Accounting Assignment - Question 1 - Dr. Kelvin opened a dental clinic on August 1, 2018. The business transactions for August are shown below: August 1 Dr. Kelvin invested $280,000 cash in the business in exch ...

Accounting for decision makersproject - appendix

Accounting for Decision Makers PROJECT - APPENDIX A Requirements: 1. Choose a publicly traded company that you currently own/invest in or one that you would like to own / invest in 2. Research the company through the com ...

Corporate accounting assignment -assessment task - select

Corporate Accounting Assignment - Assessment task - Select two public limited companies listed on the Australian Securities Exchange (ASX) that are in the same industry. Go to the website of your selected companies. Then ...

Corporate accounting assignment -assessment task - select

Corporate Accounting Assignment - Assessment task - Select two public limited companies listed on the Australian Securities Exchange (ASX) that are in the same industry. Go to the website of your selected companies. Then ...

Instructions for preparation of assignment1 you are to

Instructions for Preparation of Assignment: 1. You are to choose one management accounting topic from the list below for this assignment, and register your chosen topic with your lecturer in class or via email before com ...

Management accounting with a strategic perspective

MANAGEMENT ACCOUNTING with a STRATEGIC PERSPECTIVE Assignment - This Assignment is designed to give students an opportunity to: 1. Integrate traditional, contemporary and advanced theoretical and technical management acc ...

Management accounting assessment - research amp analysis

Management Accounting Assessment - Research & Analysis Teamwork Assessment Description - Learning Outcome - Analyse the issues or problems (in a given scenario) using management accounting techniques and tools, and formu ...

  • 4,153,160 Questions Asked
  • 13,132 Experts
  • 2,558,936 Questions Answered

Ask Experts for help!!

Looking for Assignment Help?

Start excelling in your Courses, Get help with Assignment

Write us your full requirement for evaluation and you will receive response within 20 minutes turnaround time.

Ask Now Help with Problems, Get a Best Answer

Why might a bank avoid the use of interest rate swaps even

Why might a bank avoid the use of interest rate swaps, even when the institution is exposed to significant interest rate

Describe the difference between zero coupon bonds and

Describe the difference between zero coupon bonds and coupon bonds. Under what conditions will a coupon bond sell at a p

Compute the present value of an annuity of 880 per year

Compute the present value of an annuity of $ 880 per year for 16 years, given a discount rate of 6 percent per annum. As

Compute the present value of an 1150 payment made in ten

Compute the present value of an $1,150 payment made in ten years when the discount rate is 12 percent. (Do not round int

Compute the present value of an annuity of 699 per year

Compute the present value of an annuity of $ 699 per year for 19 years, given a discount rate of 6 percent per annum. As