{"id":286,"date":"2014-03-20T17:24:52","date_gmt":"2014-03-20T09:24:52","guid":{"rendered":"http:\/\/www.cncmachinings.com\/edwards-manufacturing-company-purchases-two-component-parts-from-three-different-suppliers\/"},"modified":"2014-03-20T17:24:53","modified_gmt":"2014-03-20T09:24:53","slug":"edwards-manufacturing-company-purchases-two-component-parts-from-three-different-suppliers","status":"publish","type":"post","link":"https:\/\/www.cncmachinings.com\/blog\/edwards-manufacturing-company-purchases-two-component-parts-from-three-different-suppliers\/","title":{"rendered":"Edwards Manufacturing Company purchases two component parts from three different suppliers.?"},"content":{"rendered":"<div style=\"float:left;margin:5px;font-size:80%;\"><img decoding=\"async\" alt=\"component manufacturing company\" src=\"https:\/\/www.cncmachinings.com\/blog\/wp-content\/uploads\/2014\/03\/7412537294_c3afa81b2f_m.jpg\" width=\"160\"\/><br \/> by <a href=\"http:\/\/www.flickr.com\/photos\/18548283@N00\/7412537294\">slworking2<\/a><\/div>\n<p><strong><i>Question by Gham<\/i>: Edwards Manufacturing Company purchases two component parts from three different suppliers.?<\/strong><br \/>\nThe suppliers have limited capacity, and no one supplier can meet all the company&#8217;s needs. In addition, the suppliers charge different prices for the components. Component price data (in price per unit) are as follows:<\/p>\n<p>                                         Supplier<\/p>\n<p>Component                1             2           3<\/p>\n<p>        1                     $ 12         $ 13         $ 14<\/p>\n<p>        2                     $ 10         $ 11         $ 10<\/p>\n<p>Each supplier has a limited capacity in terms of the total number of components it can supply. However, as long as Edwards provides sufficient advance orders, each supplier can devote its capacity to component 1, component 2, or any combination of the two components, if the total number of units ordered is within its capacity. Supplier capacities are as follows.<\/p>\n<p>Supplier          1           2          3<\/p>\n<p>Capacity        600     1000     800<\/p>\n<p>If the Edwards production plan for the next period includes 1000 units of component 1 and 800 units of component 2, how many units of each component (C1, C2) should be ordered from each supplier (S1, S2, S3)?<\/p>\n<p>What is the total purchase cost for the components?<\/p>\n<p><strong>Best answer:<\/strong><\/p>\n<p><i>Answer by Meng tian<\/i><br \/>In short, for each component, we should look for the supplier offering the lowest price.<br \/>\nFor component 1, that will be supplier 1.<br \/>\nFor component 2, that will be supplier 1 and 3.<br \/>\nHowever, since we need to buy component 1 from supplier 1 as well, so we should buy component 2 from supplier 3 instead.<\/p>\n<p>We need 1000 units of component 1.<br \/>\nSupplier 1 only provide us with 600 units.<br \/>\nFor the other 400 units, it must come from the supplier who offer the next lowest price, which is supplier 2.<br \/>\nThus, we will get the remaining 400 units of component 1 from supplier 2.<br \/>\nSupplier 3, on the other hand, will provide us with all 800 units of component 2.<\/p>\n<p>The amount we will pay supplier 1 is:<br \/>\n$ 12 x 600 = $ 7200<br \/>\nThe amount we will pay supplier 2 is:<br \/>\n$ 13 x 400 = $ 5200<br \/>\nThe amount we will pay supplier 3 is:<br \/>\n$ 10 x 800 = $ 8000<\/p>\n<p>Hence, the total purchase cost is:<br \/>\n$ 7200 + $ 5200 + $ 8000 = $ 20400<\/p>\n<p><strong>Know better? Leave your own answer in the comments!<\/strong><\/p>\n","protected":false},"excerpt":{"rendered":"<p>by slworking2 Question by Gham: Edwards Manufacturing Company purchases two component parts from three different suppliers.? The suppliers have limited capacity, and no one supplier can meet all the company&#8217;s needs. In addition, the suppliers charge different prices for the components. Component price data (in price per unit) are as follows: Supplier Component 1 2 [&hellip;]<\/p>\n","protected":false},"author":1,"featured_media":287,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[3],"tags":[185,308,310,306,148,4162,31,307,134,309],"class_list":["post-286","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-machining","tag-company","tag-component","tag-different","tag-edwards","tag-from","tag-manufacturing","tag-parts","tag-purchases","tag-suppliers","tag-three"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v27.4 - https:\/\/yoast.com\/product\/yoast-seo-wordpress\/ -->\n<title>Edwards Manufacturing Company purchases two component parts from three different suppliers.?<\/title>\n<meta name=\"description\" content=\"Edwards Manufacturing Company purchases two component parts from three different suppliers.? posted by CNC machining China services company and precision CNC machined parts Chinese manufacturer.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.cncmachinings.com\/blog\/edwards-manufacturing-company-purchases-two-component-parts-from-three-different-suppliers\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Edwards Manufacturing Company purchases two component parts from three different suppliers.?\" \/>\n<meta property=\"og:description\" content=\"Edwards Manufacturing Company purchases two component parts from three different suppliers.? 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