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Leno Company makes swimsuits and sells these suits directly to retailers. Although Leno has a variety of suits, it does not make the All-Body suit

Leno Company makes swimsuits and sells these suits directly to retailers. Although Leno has a variety of suits, it does not make the All-Body suit used by highly skilled swimmers. The market research department believes that a strong market exists for this type of suit. The department indicates that the All-Body suit would sell for approximately $100. Given its experience, Leno believes the All-Body suit would have the following manufacturing costs.

Direct Materials: $25

Direct Labor: $30

Manufacturing Overhead: $45

Total costs: $100

Under what circumstances might Leno consider manufacturing the All-Body swimsuit given this approach?

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