Stellas Swimsuits It is Stellas sixth-year work anniversary and she has just completed her 650th flight. She started her flight attendant career on January 1st , 2016 after completing her HR certificate and flight schooling. At first, Stella enjoyed the international flight and travelling to exotic locations. In the off days between landing and return to Canada, she would visit the city museums and keep an eye out for fashion. Initially, she was working 200 shorter flight routes which were each from 3 hours to 9 hours in range. Compensation for these flights averaged out at $48 per flight hour. For the long-haul flights greater than 9 hours in length (prominent from her second-year onwards), Stella was paid overtime at an added $24 per hour. Typically, there were three long haul flights offered per month. In 2018, she made $50,000 by booking as many long-haul flights as was possible and was also paid a bonus of $7,500 for her outstanding performance. 2019 was a similarly good year for Stella- she earned $55,000 but did not benefit from a bonus as the airline was struggling to meet its own profit targets. 2020 and 2021 brought a dramatic decrease in flight offerings and as Stella was relatively junior, she was temporarily laid off by the airline. Finding additional free time, Stella began to watch old fashion designer movies, improving her sewing skills, and getting creative with her moms old sewing machine. She ultimately started to focus on creating swim wear and bathing suits. In 2021, Stella sold 40 pairs of swimwear she didnt keep track of whether it was bikinis or swimsuits for men. In 2020, she sold 18 bikinis as she was not yet making mens swimwear. Stella spent three weeks designing and experimenting with different fabrics, cuts, and patterns. Once perfected, she started to build up her inventory. Uncertain of how to begin selling her products, she noticed her local Farmers Market that used to be held in the town square on Saturdays had been moved online. She reached out to the Farmers Market and they agreed to host her store virtually for 15% commission on each piece she sold. Having an avenue to sell her product , Stella started to produce enough inventory to post and sell through the Farmers Market website. She didnt read all the terms, but she believes there was a line in the agreement that said she is not able to sell her products on any other platform online. The contract will last until December 31, 2022. Not knowing the full cost of her materials, time and overhead, Stella assumed a retail price of $59 per piece was a good starting point. During 2021 and 2022, Stella leisurely made items whenever she had time or got bored. She worked from her apartment (rent of $1,350 per month). She was able to find cheap fabric that sold from $3.50 to $8.75 per yard. Each bikini took about to of a yard of fabric to create. Mens swimsuits took about 1 to 1.5 yards of fabric. Stellas goal is to minimize waste. Using leftover fabric of other swimsuits, she sews patches together to make new swimsuits. On average, the elastic, thread, and lining cost, in total, $0.75 per swimsuit. Stella has heard of the concept of opportunity cost, but needs help with measuring and allocating the cost of her own time. She also wants advice on how to price her swimwear so that she can, at minimum, break even. Stellas Swimsuits While working out of her home with her mothers old machine, Stella is wondering whether it is feasible to open a store where she sells in the front and creates products in the back. Her home is too small to store all the inventory, raw materials, and house her work station. If she opens a store, Stella is thinking of hiring an additional seamstress to help with production and a sales representative to help her with the retail side. Coincidentally, there is a retail space close to her that has become vacant. Rent starts at $3,000 per month and she will have to sign a three-year lease. Stella is unsure how much she will have to pay the seamstress and sales representative. Also, she wants some broad advice on HR policy. Stella is tired of her sewing machine continually breaking down. The threading mechanism takes her significant time to fix every time and sometimes causes tears in the fabric so she has to start over. The current machine cost her mother $575 many years ago. A local repair shops says the machine can be maintained for $125 per year, which will allow it to be used heavily for three more years. A replacement sewing machine will make things more efficient and Stella will be able to make an additional 3 swimsuits per hour. A new industrial sewing machine costs $1,400 and Stella is unsure of how she would depreciate it. If she opens the store, she will need two sewing machines. Stellas friend Tony is encouraging her to start marketing and selling through social media. He insists that she should start her own website. Along the way, Tony would assist with designing and developing the website at a cost of $35 per hour for the initial design (anticipated workload of 100 hours), followed by a monthly fee of $120 for maintenance and for collecting orders. Alternatively, Tony is willing to become a partner of her business and do this work for free for a 40% share of the company. Stella wants your advice on whether this business partnership is a good idea or not. Two weeks ago, the airline called her and requested that she come and continue working for the airline as they are short staffed. They are offering to pay her $50 per flight hour and guarantee a minimum of 50 flight hours per month plus a defined pension plan when she retires at 65. They will also provide her with free flights anywhere around the world when she is not working and three weeks of vacation a year. The airline gave her the option to come back either full time or part time. If she goes on a part time basis, she will not have her pension plan. Shes trying to decide whether she should go back to the airline or take her swimsuit business full time. Last week, a local magazine saw her work thinks Stellas Swimsuits are incredibly unique. The magazine wants to place a special order of 9 bikinis and 6 swimsuits in three weeks time. Stella will need to cancel all her flights on short notice with her employer and work continuously for three weeks to be able to pull it all off in her home with the old sewing machine. The magazine has promised to pay her $620 for all the bathing suits. There is no guarantee that her bathing suits will be chosen for the next magazine cover. However, if the models and photographers like them, they will be published. Stella wants the pros and cons and the calculation of whether or not to accept this order. She will not be able to meet any other clients demands and will need to push back delivery of the existing 20 orders she has received. Stellas Swimsuits Stella is also wondering what her sales budget would look like. Historically, she has sold on account with 30% collected in the month of sale and 70% in the subsequent month. Sales are cyclical and higher in the spring and summer and lower in the fall and winter. Stellas brother who works in the tech industry raves about cryptocurrencies and has stated he has made $30,000 through BitCoins and NFTs. Stella has about $7,000 saved up in her bank account within the cash balance of $18,000 sitting in her bank account at the beginning of this month. She is wondering how she should invest this money. Stella wants to implement accounting best practices but doesnt even know where to start. She wants a detailed analysis of how to get her business records sorted out.

Advise Stella on her career path and the outlook of her proposed business. Produce a business report, including comprehensive analysis, recommendations, and any questions you may need to ask Stella.