Prior to the 2012 Super Bowl, a Bostonarea retailer ordered 49,200 T-shirts that read: New England Patriots2012 Super Bowl Champs. The company paid $11.75 for each of the custom T-shirts. Following the loss of New England to the New York Giants, the retailer found itself with 10,800 unsold T-shirts after the Super Bowl. Before the Super Bowl, the retailer was able to sell 38,400 of the T-shirts at an average per-unit price of $24.50. The company is currently deciding how to dispose of the 10,800 remaining T-shirts. The retailer has learned from one of its suppliers that each shirt could be reworked at an average cost of $5.25 per shirt (which involves removing the Super Bowl reference from the shirts). Management of the retailer believes the reworked shirts could be sold at an average price of $10.00 during the coming football season. Alternatively, the company could sell the shirts at an average price of $2.85 as scrap material. a. Identify at least three alternative courses of action management could take with regard to the leftover T-shirts.

A. Which costs are sunk in this decision? Round your answer to the nearest cent. $ per T-shirt

B. Identify the relevant costs of the following alternatives. If relevant costs are not incremental then enter your answer as zero. Round your answer to the nearest cent.

Rework alternative $ per T-shirt

Sell as rags $ per T-shirt

Do nothing $ per T-shirt

C. Based on your answers to (B), what is the best alternative and what is the relative financial advantage of the best alternative over the second-best alternative? Round your answers to the nearest cent.

Incremental profit of best alternative $ per T-shirt

The relative advantage of best alternative $ per T-shirt