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Fanatics is spending $ 3 . 5 0 each to manufacture 1 0 0 , 0 0 0 jerseys in preparation for the upcoming World
Fanatics is spending $ each to manufacture jerseys in preparation for the upcoming World Series. They took out a loan at in order to have the funds needed to manufacture these jerseys. They also pay $ in warehouse rent, $ in inventory insurance, and expect $ worth of inventory to be damaged. Assume that Fanatics DOES receive the income deduction tax break for interest payments, and is taxed at the corporate tax rate. It took Fanatics orders to receive all the materials needed to produce their jerseys, and each order cost them $ in shipping and handling.
a Find the cost Fanatics spent to manufacture the jerseys.
b Find the value in our total carrying cost formula.
c Find Fanatics' Total Carrying Cost, assuming they are storing inventory for exactly year before selling.
d Find Fanatics' Total Ordering Cost for all jerseys.
e What is the total running inventory cost for Fanatics them carrying the jerseys for 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 year, and their ordering costs?
g Bonus What price would Fanatics need to sell each jersey at in order to break even on their total jersey costs?
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