Management Science

Lecture Day 10
Solving Transportation Problems

M + N - 1 Rule

Stepping Stone Method

Modified Distribution Method

M+N1
Rule

 The number of used cells in a transportation tableau

should comply with the M + N 1 rule before
proceeding to the use of an optimization technique.
That is, the number of used cells of a transportation
tableau should always be equal to the number of rows
or sources of supply (M) plus the number of columns
or demand/destination points (N) minus one (1).
The scenario wherein the number of used cells is less
than the M + N 1 rule is known as degeneracy.
To handle degenerate problems, we assign a zero
stone (representing a fake shipment) in one of the
unused squares and then treat that square as if it
were occupied.

More Popular Heuristics

Northwest Corner Rule

Greedy Method

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

40

14

Iloilo

11

12

40

Davao

Supply
16

X
5

10

X
6

50

80

40

30

40

50

120
90

90

70

40

50

250

40

30

Optimization

50

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

40
14

Iloilo

11

12

Davao

Supply
16

X
5

40

10

X
6

40

30

50

90

70

40

50

40

30

50

80

120

40

70

250

Optimization

40

Stepping-Stone
Method

 In applying the stepping-stone method, we ask the

following question:

What would happen if one unit of supply was

tentatively shipped or assigned to an unused square?
If this tentative assignment results in a favorable
effect (reduces cost), the unused square evaluated
then becomes a possible candidate for entering
the next solution. This is analogous to the
examination of the Cj Zj row of the simplex tableau
to determine which variable should be brought into
the mix.

Steps Involved:
1. Generate a starting feasible solution by using a
heuristic. Make sure that the starting feasible
solution contains M + N 1 basic/used cells.

2. Select an unused square to evaluate.

3. Beginning with the selected unused square, trace a
closed path (moving horizontally and vertically only)
from this unused square via used squares back to
the original unused square.
4. Assign plus (+) and minus (-) signs alternately
at each corner square of the closed path, beginning
with a plus sign at the unused square.
Northwest Corner Rule
Greedy Method

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

40

14

Iloilo

11

12

40

Davao

Supply
16

X
5

10

X
6

50

80

40

30

40

50

120
90

90

70

40

50

250

40

30

50

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Baguio

Davao

Iloilo

11

16

50
+ 12

10

40

40

14

Batangas
Demand

Cebu

Supply

90

30

40

50

70

40

50

50

80

120
250

Steps

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

40
14

Iloilo

11

12

Davao

Supply
16

X
5

40

10

X
6

40

30

50

90

70

40

50

40

30

50

80

120
250

40

70

40

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

Demand

Davao

Iloilo

11

16

12

+ 14

40
- 10

40

30

90

70

50

Laguna

Batangas

Cebu

Supply

40
50
40

50

50

80

120
250

Steps

Steps Involved:
5. Determine the net change in costs (improvement index)
as a result of the changes made in tracing the path
by summing the unit cost in each square with a plus sign
and subtracting those with a negative sign.
The improvement index corresponds to the

Cj Zj value calculated by the simplex method.

6. Repeat Steps 2 to 5 until an improvement index has

been determined for each unused square.
If all the indices are greater than or equal to zero,

an optimal solution has been found. Conversely,

if any of the indices is negative, a better solution
is possible.

Northwest Corner Rule

Greedy Method

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Baguio

Davao

Iloilo

11

16

50
+ 12

+6
7

40

40
6

14

Batangas
Demand

Cebu

Supply

90

10

30

40

50

70

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Baguio

50
+ 12

+6
- 7

40

40
+ 10

14

Batangas
Demand

Cebu

90

Supply

Davao

Iloilo

+ 11

16

+ 12

30

40

50

70

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Baguio

50
+ 12

+6
- 7

40

40
+ 10

14

Batangas
Demand

Cebu

90

Supply

Davao
11

+ 12

Iloilo

+ 16
+ 16

30

40

50

70

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Baguio

Demand

Iloilo

11

12

+6
- 7

+ 12
+ 5

40
+ 10

+2
- 6

30

40

50

70

40

50

40
14

90

Davao

50

Batangas

Cebu

Supply
16

+ 16
8

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Baguio

Demand

+ 12

12

+6
- 7
40
+ 10

+2

40
14

90

Davao

50

Batangas

Cebu

Supply
Iloilo

11

16

+ 16
+ 8

+4
- 7

30

40

50

70

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

50
- 12

+6
+ 7

+ 12

40
+ 14

40
- 10

+2

Iloilo

11

16

+ 16

+4
6

-1

30

40

50

90

70

40

50

50

80

120
250

Steps

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

50

Demand

Davao

Iloilo

11

16

+5

12

+ 14

40
- 10

40

30

90

70

Laguna

Batangas

Cebu

Supply

40
50
40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

Demand

Davao

Iloilo

+ 11

16

12

+5
+ 7

+9
- 5

40

+ 14

40
- 10

40

30

90

70

50

Laguna

Batangas

Cebu

Supply

50
40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

50

Demand

Davao

+5

12

Laguna

Batangas

Cebu

Supply
11

+9

40
+ 14

30

90

70

+ 16
+ 15

40

10

40

Iloilo

50
40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

50
+ 12

+5
- 7

+9

+1
- 14

40
+ 10

40

40

30

90

70

Iloilo

11

16

+ 15
5

50
40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

+9

12

+5
- 7
40
+ 10

40

50
+1
14

40

30

90

70

Iloilo

11

16

+ 15
+ 8

+4
- 7
50

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

+9
- 5

+ 15

12

+5
+ 7
40
- 10

40
+ 6

+4

40

30

-2

50

90

70

40

50

50
+1
14

16

50

80

120
250

Steps

Steps Involved:
7. Select the unused square with the most negative
improvement index. This is analogous to the
entering variable in a simplex tableau.
8. Trace again the closed path of the unused square
with the most negative improvement index and
assign the alternating symbols, beginning with a
plus (+) sign on the unused square.
9. Determine the smallest unit assigned to a used
square with a minus (-) sign on the closed path
of the square with the most negative improvement
index.
10. Add the determined unit/s to all squares in the
closed path with plus signs and subtract from all
squares with minus signs. Then, go back to Step 2.

Northwest Corner Rule

Greedy Method

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

50
- 12

+6
+ 7

+ 12

40
+ 14

40
- 10

+2

Iloilo

11

16

+ 16

+4
6

-1

30

40

50

90

70

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From

Baguio

Cebu

Cavite

50
12

Laguna

10

Batangas
Demand

Davao

+6

Supply
11

+ 11

70

14

Iloilo
16

+ 15
5

+1

10

+3
6

30

+1

40

50

90

70

40

50

Minimum transportation cost = P2,020

Another Example

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

+9
- 5

+ 15

12

+5
+ 7
40
- 10

40
+ 6

+4

40

30

-2

50

90

70

40

50

50
+1
14

16

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

16

50
+ 12

+7

+ 15

+ 11
- 5

-1
- 14

70

+2

10

10
+ 6

40

+2

30

50

90

70

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From

Baguio

Cebu

Cavite

50
12

Laguna

10

Batangas
Demand

Davao

+6

Supply
11

+ 11

70

14

Iloilo
16

+ 15
5

+1

10

+3
6

30

+1

40

50

90

70

40

50

Minimum transportation cost = P2,020

Another Example

50

80

120
250

More Popular Heuristics

Northwest Corner Rule

Greedy Method

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

40

14

Iloilo

11

12

40

Davao

Supply
16

X
5

10

X
6

50

80

40

30

40

50

120
90

90

70

40

50

250

40

30

50

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

16

50
- 12

+6
+ 7

+ 12

40
+ 14

40
- 10

+2

-1

30

40

50

90

70

40

50

+ 16
5

+4
6

50

80

120
250

The Cordoba Company

Warehouse

To
From

Baguio

Cebu

Cavite

50
12

Laguna

10

Batangas
Demand

Davao

+6

Supply
11

+ 11

70

14

Iloilo
16

+ 15
5

+1

10

+3
6

30

+1

40

50

90

70

40

50

Minimum transportation cost = P2,020

Another Optimization Technique

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

40
14

Iloilo

11

12

Davao

Supply
16

X
5

40

10

X
6

40

30

50

90

70

40

50

40

30

50

80

120
250

40

70

40

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

+9
- 5

+ 15

12

+5
+ 7
40
- 10

40
+ 6

+4

40

30

-2

50

90

70

40

50

50
+1
14

16

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

16

50
+ 12

+7

+ 15

+ 11
- 5

-1
- 14

70

+2

10

10
+ 6

40

+2

30

50

90

70

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From

Baguio

Cebu

Cavite

50
12

Laguna

10

Batangas
Demand

Davao

+6

Supply
11

+ 11

70

14

Iloilo
16

+ 15
5

+1

10

+3
6

30

+1

40

50

90

70

40

50

Minimum transportation cost = P2,020

Another Optimization Technique

50

80

120
250

Modified Distribution
(MODI)

Method

 MODI is a streamlined version of the simplex method

that takes advantage of the special mathematical
structure of the transportation model.
One advantage of the MODI over the simplex method
is that it does not require the use of slack or artificial
variables to get a starting feasible solution.
In the regular simplex method, cost-reducing variables
are recognized by having a negative Cj Zj value.
The same Cj Zj indicators are used in the MODI
method but are calculated in a much easier way.

Steps Involved:
1. Generate a starting feasible solution by using a
heuristic. Make sure that the starting feasible
solution contains M + N 1 basic/used cells.

2. Assign row and column indicators to each row and

column of the transportation tableau.
In general, for an m x n transportation problem,
let:
Ri = indicator value assigned to row i
where i = 1, 2, . . . , m
Kj = indicator value assigned to column j
where j = 1, 2, . . . , n

More Popular Heuristics

Row-Minimum Method
Vogels Approximation Method

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

40
14

Iloilo

11

12

Davao

Supply
16

X
5

40

10

X
6

50

80

40

40

30

50

120
70

90

70

40

50

250

40

30

40

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

Demand

Davao

Iloilo

11

16

12

50

Laguna

Batangas

Cebu

Supply

40
14

40

10

40

30

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Steps

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

50

Laguna

Batangas
Demand

Cebu

90

Davao

Supply
Iloilo

11

16

12

14

10

70

40

50

40

50

80

120

250

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

50

Laguna

Batangas
Demand

Cebu

90

Davao

Supply
Iloilo

11

16

12

14

10

70

40

50

40

50

80

120

250

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

50

Davao

Iloilo

11

12

Laguna

16

X
5

70
14

Batangas
Demand

Cebu

Supply

10

X
90

70

40

50

40

50

80

10

120
250

2
1

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

50

Davao

Iloilo

11

12

Laguna

16

X
5

70
14

Batangas
Demand

Cebu

Supply

10

X
90

70

40

50

40

50

80

10

120
250

3
1

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

70
14

Iloilo

11

12

Davao

Supply
16

X
5

10

10

X
6

40

30

50

90

70

40

50

40

30

50

80

10

120
250

90

3
1

40

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

Demand

Davao

Iloilo

11

16

12

50

Laguna

Batangas

Cebu

Supply

70
14

10

10

40

30

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Steps Involved:
3. Compute values for the Ri and Kj indicators using:
Ri + Kj = Cij whenever xij > 0

Where: Cij = per unit transportation cost

Xij = shipment from source i to
destination j
4. Solve the resulting m + n equations by setting
R1 equal to zero and back-substituting for the
remaining Ri and Kj values.
Row-Minimum Method
Vogels Approximation

Ri + Kj = Cij

R1 + K1 =
R2 + K2 =
R2 + K3 =
R3 + K1 =
R3 + K2 =
R3 + K4 =

8
7
5
14
10
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
3
6
8
4
2
1

Ri + Kj = Cij

R1 + K1 =
R2 + K2 =
R2 + K3 =
R3 + K1 =
R3 + K2 =
R3 + K4 =

8
7
5
14
10
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
3
6
8
4
2
1

Steps

Ri + Kj = Cij

R1 + K1 =
R2 + K2 =
R2 + K3 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

8
7
5
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
5
6
8
2
0
1

Ri + Kj = Cij

R1 + K1 =
R2 + K2 =
R2 + K3 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

8
7
5
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
5
6
8
2
0
1

Steps Involved:
5. Calculate the opportunity costs of increasing
shipments through each non-basic (unused) cell
using the formula:

Cij (Ri + Kj) = opportunity cost

for non-basic cell (i,j)
6. Select the non-basic cell with the most negative
opportunity cost.
If no non-basic cell has a negative
Cij (Ri + Kj), stop, for the solution is
already optimal.
Row-Minimum Method
Vogels Approximation

Cij (Ri + Kj) = OC

9 (0 + 4) = + 5
11 (0 + 2) = + 9
16 (0 + 1) = +15
12 (3 + 8) = + 1
8 (3 + 1) = + 4
6 (6 + 2) = - 2
Steps

Cij (Ri + Kj) = OC

9 (0 + 2) = + 7
11 (0 + 0) = +11
16 (0 + 1) = +15
12 (5 + 8) = - 1
8 (5 + 1) = + 2
10 (6 + 2) = + 2

Steps Involved:
7. Trace a closed path for the non-basic cell with the
most negative Cij (Ri + Kj) value. Assign plus (+)
and minus (-) signs alternately at each corner
square of the closed path, beginning with a plus sign
at the non-basic cell.
8. Determine the smallest unit/shipment assigned to a
used square in a negative position on the closed
path of the non-basic cell with the most negative
Cij (Ri + Kj) value.
9. Add the determined unit/s to all squares in the
closed path with plus signs and subtract from all
squares with minus signs.
10. Go back to Step 2.

Row-Minimum Method

Vogels Approximation

Cij (Ri + Kj) = OC

9 (0 + 4) = + 5
11 (0 + 2) = + 9
16 (0 + 1) = +15
12 (3 + 8) = + 1
8 (3 + 1) = + 4
6 (6 + 2) = - 2

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

Demand

Davao

Iloilo

11

16

40
+ 6

50

Laguna

Batangas

Cebu

Supply

12

14

40
- 10

40

30

90

70

50
40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

Demand

Davao

Iloilo

11

16

12

50

Laguna

Batangas

Cebu

Supply

70
14

10

10

40

30

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Ri + Kj = Cij
R1 + K1 = 8
R2 + K2 = 7

R2 + K3 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

5
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
5
6
8
2
0
1

Ri + Kj = Cij
R1 + K1 = 8
R2 + K2 = 7

R2 + K3 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

5
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
5
6
8
2
0
1

Cij (Ri + Kj) = OC

9 (0 + 2) = + 7
11 (0 + 0) = +11

16 (0 + 1) = +15
12 (5 + 8) = - 1
8 (5 + 1) = + 2
10 (6 + 2) = + 2

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Davao

50
+ 12

10

70
-

14

40
90

70

Supply
Iloilo

11

16

10
+ 6

30

50

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

16

12

10

50
10

70

14

30

40

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Ri + Kj = Cij
R1 + K1 = 8
R2 + K1 = 12

R2 + K2 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

7
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
4
6
8
3
0
1

Ri + Kj = Cij
R1 + K1 = 8
R2 + K1 = 12

R2 + K2 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

7
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
4
6
8
3
0
1

Cij (Ri + Kj) = OC

9 (0 + 3) = + 6
11 (0 + 0) = +11

16 (0 + 1) = +15
5 (4 + 0) = + 1
8 (4 + 1) = + 3
10 (6 + 3) = + 1

The Cordoba Company

Warehouse

To
From

Baguio

Cavite

Cebu

Supply

Davao

Iloilo

11

16

12

10

50

Laguna

10

Batangas
Demand

70

14

30
90

70

40

50

40

50

Minimum transportation cost = P2,020

Another Example

50

80

120
250

Cij (Ri + Kj) = OC

9 (0 + 2) = + 7
11 (0 + 0) = +11
16 (0 + 1) = +15
12 (5 + 8) = - 1
8 (5 + 1) = + 2
10 (6 + 2) = + 2

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Davao

50
+ 12

10

70
-

14

40
90

70

Supply
Iloilo

11

16

10
+ 6

30

50

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

16

12

10

50
10

70

14

30

40

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Ri + Kj = Cij
R1 + K1 = 8
R2 + K1 = 12

R2 + K2 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

7
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
4
6
8
3
0
1

Ri + Kj = Cij
R1 + K1 = 8
R2 + K1 = 12

R2 + K2 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

7
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
4
6
8
3
0
1

Cij (Ri + Kj) = OC

9 (0 + 3) = + 6
11 (0 + 0) = +11

16 (0 + 1) = +15
5 (4 + 0) = + 1
8 (4 + 1) = + 3
10 (6 + 3) = + 1

The Cordoba Company

Warehouse

To
From

Baguio

Cavite

Cebu

Supply

Davao

Iloilo

11

16

12

10

50

Laguna

10

Batangas
Demand

70

14

30
90

70

40

50

40

50

Minimum transportation cost = P2,020

Another Example

50

80

120
250

More Popular Heuristics

Row-Minimum Method
Vogels Approximation Method

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

40
14

Iloilo

11

12

Davao

Supply
16

X
5

40

10

X
6

50

80

40

40

30

50

120
70

90

70

40

50

250

40

30

40

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

Demand

Davao

Iloilo

11

16

12

50

Laguna

Batangas

Cebu

Supply

40
14

40

10

40

30

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Ri + Kj = Cij
R1 + K1 = 8
R2 + K2 = 7

R2 + K3 =
R3 + K1 =
R3 + K2 =
R3 + K4 =

5
14
10
7

R1 = 0
R2 = 3
R3 = 6

K1
K2
K3
K4

=
=
=
=

8
4
2
1

Ri + Kj = Cij
R1 + K1 = 8
R2 + K2 = 7

R2 + K3 =
R3 + K1 =
R3 + K2 =
R3 + K4 =

5
14
10
7

R1 = 0
R2 = 3
R3 = 6

K1
K2
K3
K4

=
=
=
=

8
4
2
1

Cij (Ri + Kj) = OC

9 (0 + 4) = + 5
11 (0 + 2) = + 9

16 (0 + 1) = +15
12 (3 + 8) = + 1
8 (3 + 1) = + 4
6 (6 + 2) = - 2

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

Demand

Davao

Iloilo

11

16

40
+ 6

50

Laguna

Batangas

Cebu

Supply

12

14

40
- 10

40

30

90

70

50
40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

Demand

Davao

Iloilo

11

16

12

50

Laguna

Batangas

Cebu

Supply

70
14

10

10

40

30

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Ri + Kj = Cij
R1 + K1 = 8
R2 + K2 = 7

R2 + K3 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

5
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
5
6
8
2
0
1

Ri + Kj = Cij
R1 + K1 = 8
R2 + K2 = 7

R2 + K3 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

5
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
5
6
8
2
0
1

Cij (Ri + Kj) = OC

9 (0 + 2) = + 7
11 (0 + 0) = +11

16 (0 + 1) = +15
12 (5 + 8) = - 1
8 (5 + 1) = + 2
10 (6 + 2) = + 2

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Davao

50
+ 12

10

70
-

14

40
90

70

Supply
Iloilo

11

16

10
+ 6

30

50

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

16

12

10

50
10

70

14

30

40

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Ri + Kj = Cij
R1 + K1 = 8
R2 + K1 = 12

R2 + K2 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

7
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
4
6
8
3
0
1

Ri + Kj = Cij
R1 + K1 = 8
R2 + K1 = 12

R2 + K2 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

7
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
4
6
8
3
0
1

Cij (Ri + Kj) = OC

9 (0 + 3) = + 6
11 (0 + 0) = +11

16 (0 + 1) = +15
5 (4 + 0) = + 1
8 (4 + 1) = + 3
10 (6 + 3) = + 1

The Cordoba Company

Warehouse

To
From

Baguio

Cavite

Cebu

Supply

Davao

Iloilo

11

16

12

10

50

Laguna

10

Batangas
Demand

70

14

30
90

70

40

50

40

50

Minimum transportation cost = P2,020

Next Topic

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

50

Laguna

Batangas
Demand

Cebu

90

Davao

Supply
Iloilo

11

16

12

14

10

70

40

50

40

50

80

120

250

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

50

Laguna

Batangas
Demand

Cebu

90

Davao

Supply
Iloilo

11

16

12

14

10

70

40

50

40

50

80

120

250

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

50

Davao

Iloilo

11

12

Laguna

16

X
5

70
14

Batangas
Demand

Cebu

Supply

10

X
90

70

40

50

40

50

80

10

120
250

2
1

The Cordoba Company

Warehouse

To
From
Cavite

Baguio
8

50

Davao

Iloilo

11

12

Laguna

16

X
5

70
14

Batangas
Demand

Cebu

Supply

10

X
90

70

40

50

40

50

80

10

120
250

3
1

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

50

70
14

Iloilo

11

12

Davao

Supply
16

X
5

10

10

X
6

40

30

50

90

70

40

50

40

30

50

80

10

120
250

90

3
1

40

The Cordoba Company

Warehouse

To
From
Cavite

Baguio

Demand

Davao

Iloilo

11

16

12

50

Laguna

Batangas

Cebu

Supply

70
14

10

10

40

30

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Ri + Kj = Cij
R1 + K1 = 8
R2 + K2 = 7

R2 + K3 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

5
14
6
7

R1 = 0
R2 = 5
R3 = 6

K1
K2
K3
K4

=
=
=
=

8
2
0
1

Ri + Kj = Cij
R1 + K1 = 8
R2 + K2 = 7

R2 + K3 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

5
14
6
7

R1 = 0
R2 = 5
R3 = 6

K1
K2
K3
K4

=
=
=
=

8
2
0
1

Cij (Ri + Kj) = OC

9 (0 + 2) = + 7
11 (0 + 0) = +11

16 (0 + 1) = +15
12 (5 + 8) = - 1
8 (5 + 1) = + 2
10 (6 + 2) = + 2

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Davao

50
+ 12

10

70
-

14

40
90

70

Supply
Iloilo

11

16

10
+ 6

30

50

40

50

50

80

120
250

The Cordoba Company

Warehouse

To
From
Cavite

Laguna

Batangas
Demand

Baguio

Cebu

Supply

Davao

Iloilo

11

16

12

10

50
10

70

14

30

40

50

90

70

40

50

K1

K2

K3

K4

50

R1

80

R2

120

R3

250

Ri + Kj = Cij
R1 + K1 = 8
R2 + K1 = 12

R2 + K2 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

7
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
4
6
8
3
0
1

Ri + Kj = Cij
R1 + K1 = 8
R2 + K1 = 12

R2 + K2 =
R3 + K1 =
R3 + K3 =
R3 + K4 =

7
14
6
7

R1 =
R2 =
R3 =
K1 =
K2 =
K3 =
K4 =

0
4
6
8
3
0
1

Cij (Ri + Kj) = OC

9 (0 + 3) = + 6
11 (0 + 0) = +11

16 (0 + 1) = +15
5 (4 + 0) = + 1
8 (4 + 1) = + 3
10 (6 + 3) = + 1

The Cordoba Company

Warehouse

To
From

Baguio

Cavite

Cebu

Supply

Davao

Iloilo

11

16

12

10

50

Laguna

10

Batangas
Demand

70

14

30
90

70

40

50

40

50

Minimum transportation cost = P2,020

50

80

120
250

 For maximization problems, either change

the signs of the objective function values
and minimize, or choose the non-basic cell
with the most positive Cij (Ri + Kj) value
to enter the solution; all other steps
remain the same.

End of Lecture Day 10