Total demand = 72 + 102 + 41 = 215 and
Total supply = 76 + 82 + 77 = 235.
Total supply > Total demand. So we add a dummy constraint with 0 unit cost and with allocation 20 (235 – 215). The modified table is
First allocation:
The maximum penalty is 16. Allot 20 units to cell (S2 , Ddummy )
Second allocation:
Third allocation:
Fourth allocation:
The final allocation table is given below.
The minimum total cost = (76 × 8) + (21 × 24) + (41 × 16) + (20 × 0) + (72 × 8) + (5 × 16)
= 2424
