The peak load for Swimsuits Inc.(SWIM),a manufacturer of bathing suits,occurs in March and April when the cutters and sewers occupy every square foot in the plant.This determines the maximum output capacity of the company,which is 250 suits per hour.SWIM works a 10-hour day,six days a week.Adding shift time is considered impossible.Therefore,it has been suggested that floor space be expanded by renting an adjoining loft for $1,200 per week.This would increase maximum output capacity by 12 percent.The sales manager believes that SWIM could sell 18,000 bathing suits per week during the 10-week season,at a profit of $1.00 per suit based on existing costs of materials and labor.During the summer,the SWIM plant is less than 50 percent utilized.Explain why the loft should or should not be rented.Are there any other capacity-based observations to be considered? If FC = $1200,vc = $15 and R = $16,determine the BEP.

Question

Quizplus · Accepted Answer

The Answer of The peak load for Swimsuits Inc.(SWIM),a manufacturer of bathing suits,occurs in March and April when the cutters and sewers occupy every square foot in the plant.This determines the maximum output capacity of the company,which is 250 suits per hour.SWIM works a 10-hour day,six days a week.Adding shift time is considered impossible.Therefore,it has been suggested that floor space be expanded by renting an adjoining loft for $1,200 per week.This would increase maximum output capacity by 12 percent.The sales manager believes that SWIM could sell 18,000 bathing suits per week during the 10-week season,at a profit of $1.00 per suit based on existing costs of materials and labor.During the summer,the SWIM plant is less than 50 percent utilized.Explain why the loft should or should not be rented.Are there any other capacity-based observations to be considered? If FC = $1200,vc = $15 and R = $16,determine the BEP.

The Peak Load for Swimsuits Inc