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A company supplies goods to three customers, who each require 30 units. The company has two warehouses. Warehouse 1 has 40 units available and warehouse 2 has 30 units available. The cost shipping 1 unit from warehouse to customer are shown in table below. There is a penalty for each unmet customer unit of demand: with customer 1 a penalty cost of 490 is incurred; with customer 2, $80; and with customer 3, $110. Formulate a balanced transportation problem to minimize the sum of shortage and shipping cost.
From Customer 1 Customer 2 Customer 3
Warehouse 1 $15 $35 $25Warehouse 2 $10 $50 $40
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