Anbessa City Bus Service Enterprise (ACBSE) is the only public enterprise that providesrntransport services in and around the city of Addis Ababa. The transportationrnservice provided by ACBSE is the safest and cheapest as compared with other publicrntransport system in the city. However, due to the rapidly growing mass mobility, highrnpopulation growth and galloping urbanization in the city of Addis Ababa, providingrnand improving urban public transport service is becoming highly di cult and thernenterprise leaves much to be desired and remains long to go. The enterprise as well asrnthe Ethiopian government has made di erent interventions to address the problem.rnNotwithstanding the e orts attempted, the interventions in the short run as wellrnas in the long run could not fully address the problem without e cient utilizationrnand scheduling of buses. Whatever systems are in place as a solution, if there is norne cient use of that system, it may rather create additional problem.rnThe unbalanced bus scheduling and xed bus assignment systems currently used byrnthe enterprise contributed its share to the problem of poor service quality, low operationalrnand nancial performances. This dissertation, therefore, tries to assess thernexisting operational and nancial performances of the enterprise and develop di erentrnmodels that can improve the performances of the bus scheduling and assignmentrnsystems of the enterprise.rnTo achieve these objectives, the dissertation conducts an extensive literature reviewrnrelated to Vehicle Routing Problem (VRP), urban bus public transport services andrndi erent international standards related to urban bus transport. Primary and secondaryrndata related to route performance, bus utilization and scheduling techniquesrnof the enterprise were also collected. Using the data and the observations made,rn rst, di erent operational and nancial performance analysis was made. Then anrnLP model that can improve the performances of the enterprise was developed. It