2. Gordon Company produces a range of high quality jigsaw puzzles for adults and children. The company is based in Waterford and has been in operation for over twenty years. It produces three types of jigsaw, 30 piece and 250 piece for children and 1,000 piece for teenagers and adults. In the past two years, the company has experienced increasing demand for its products and has expanded production to meet demand. However, sales forecasts for the current year suggest that demand for all types of jigsaw puzzles is much higher than in previous years. The production manager has indicated that the company has a total of 32,000 machine hours and 18,000 direct labour hours available for the current year. Production and sales details relating to three types of jigsaw are shown below. 30 piece jigsaw 250 piece jigsaw 1,000 piece jigsaw 0.25 metres 0.5 metres 6 mins 8 mins 0.75 metres 10 mins Direct materials: Paperboard @ 1.60 per metre Direct labour: @ 14.40 per hour Variable overhead: 75% Direct labour cost Machine hours required Sales demand for the year (units) Selling price per unit 0.2 hour 50,000 3.60 0.25 hour 27,000 5.45 0.5 hour 36,600 7.85 Required: a) Prepare calculations to show whether Gordon Company will have sufficient production capacity to meet budgeted demand for its products. (8 marks) b) Compute the optimal production plan for Gordon and show the annual profit expected. (22 marks) c) Post World War II era, Japan lacked the cash to finance big-batch, large inventory production methods used by other developed countries. They also had high unemployment and a lack of natural resources. In order to survive, they had to 'lean out their processes. They built smaller factories, which focused on quickly turning small amounts of raw materials into small amounts of physical products. This system that they used came to be known as just in time (JIT) manufacturing, commonly known as the Toyota Production System. Discuss the JIT system and critically evaluate the benefits and limitations of a JIT system. (20 marks)