Case Problem 2~Production StrategyBetter Fitness, Inc. (BFI), manufactures exercise equipment at its plant in Freeport, LongIsland. It recently designed two universal weight machines for the home exercise market.Both machines use BFI-patented technology that provides the user with an extremely widerange of motion capability for each type of exercise performed. Until now, such capabilitieshave been available only on expensive weight machines used primarily by physical therapists.At a recent trade show, demonstrations of the machines resulted in significant dealerinterest. In fact, the number of orders that BFI received at the trade show far exceeded itsmanufacturing capabilities for the current production period. As a result, management decided to begin production of the two machines. The two machines, which BFI named theBodyPlus 100 and the BodyPlus 200, require different amounts of resources to produce.The BodyPlus 100 consists of a frame unit, a press station, and a pec-dec station. Each frameproduced nses 4 hours of machining and welding time and 2 hours of painting and finishingtime. Each press station requires 2 hours of machining and welding time and 1 hour of paintingand finishing time, and each pec-dec station uses 2 hours of machining and welding time and2 hours of painting and finishing time. In addition, 2 hours are spent assembling, testing, andpackaging each BodyPlus 100. The raw material costs are $450 for each frame, $300 for eachpress station, and $250 for each pec-dec station; packaging costs are estimated to be $50 per unit.The BodyPlus 200 consists of a frame unit, a press station, a pec-dec station, and a legpress station. Each frame produced uses 5 hours of machining and welding time and 4 hoursof painting and finishing time. Each press station requires 3 hours of machining and weldingtime and 2 hours of painting and finishing time, each pec-dec station uses 2 hours of machining and welding time and 2 hours of painting and finishing time, and each leg-press stationrequires 2 hours of machining and welding time and 2 hours of painting and finishing time. Inaddition, 2 hours are spent assembling, testing, and packaging each BodyPlus 200. The rawmaterial costs are $650 for each frame, $400 for each press station, $250 for each pec-decstation, and $200 for each leg-press station; packaging costs are estimated to be $75 per unit.For the next production period, management estimates that 600 hours of machining andwelding time; 450 hours of painting and finishing time; and 140 hours of assembly, testing,and packaging time will be available. Current labor costs are $20 per hour for machining andwelding time; $15 per hour for painting and finishing time; and $12 per hour for assembly,testing, and packaging time. The market in which the two machines must compete suggestsa retail price of $2400 for the Body Plus 100 and $3500 for the Body Plus 200, although someflexibility may be available to BFI because of the unique capabilities of the new machines.Authorized BFI dealers can purchase machines for 70% of the suggested retail price.BFI’s president believes that the unique capabilities of the BodyPlus 200 can help positionBFI as one of the leaders in high-end exercise equipment. Consequently, she states that thenumber of units of the BodyPlus 200 produced must be at least 25% of the total production.Managerial ReportAnalyze the production problem at Better Fitness, Inc., and prepare a report for BFI’spresident presenting your findings and recommendations. Include (but do not limit yourdiscussion tOJ a consideration of the following items:1. The recommended number of BodyPlus 100 and BodyPlus 200 machines to produce2. The effect on profits of the requirement that the number of units of the BodyPlus200 produced must be at least 25% of the total production3. Where efforts should be expended in order to increase contribution to profits. Include a copy of your linear programming model and graphical solution in an appendixto your report.