Fanatics is spending $3.50 each to manufacture 100,000 jerseys in preparation for the upcoming World...

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Accounting

Fanatics is spending $3.50 each to manufacture 100,000 jerseys in preparation for the upcoming World Series. They took out a loan at 4.5% in order to have the funds needed to manufacture these jerseys. They also pay $5,000 in warehouse rent, $1,000 in inventory insurance, and expect $600 worth of inventory to be damaged. Assume that Fanatics DOES receive the income deduction tax break for interest payments, and is taxed at the 40% corporate tax rate. It took Fanatics 5 orders to receive all the materials needed to produce their 100,000 jerseys, and each order cost them $1,000 in shipping and handling.
a) Find the cost Fanatics spent to manufacture the 100,000 jerseys.
b) Find the C value in our total carrying cost formula.
c) Find Fanatics' Total Carrying Cost, assuming they are storing inventory for exactly 1 year before selling.
d) Find Fanatics' Total Ordering Cost for all 100,000 jerseys.
e) What is the total running inventory cost for Fanatics - them carrying the jerseys for 1 year and ordering the jerseys?
f) What is the total cost for the jerseys when taking all this into account - their total manufacturing costs, their carrying cost for 1 year, and their ordering costs?
g) Bonus +1! What price would Fanatics need to sell each jersey at in order to break even on their total jersey costs?
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