Identifying and managing unused capacity. Refer to the Meredith Corporation information ®

in Exercise 13-18. 1. Amount of unused manufacturing capacity, 40 REQUIRED g capacity 1. Where possible, calculate the amount and cost of unused capacity for

(a) manufacturing,

(b) selling and customer service, and

(c) design at the beginning of 2009 based on 2009 production. If you could not calculate the amount and cost of unused capacity, indicate why not.

2. Suppose Meredith can add or reduce its manufacturing capacity in increments of 30 units.

What is the maximum amount of costs that Meredith could save by downsizing manufacturing capacity?

3. Meredith, in fact, does not eliminate any of its unused manufacturing capacity. Why might Meredith not downsize?

LO1