This problem comes from Managerial Accounting a Focus on Ethical Decision Making 5th edition, Jackson, Sawyer and Jenkins. You recently began work at Colt Kitchen Ltd. The company is a well-known distributor of gourmet foods. Like many similar companies, Colt Kitchen currently maintains a relatively large warehouse in which a wide variety of products are stored. Most other food wholesalers also maintain large warehouses, however, Sharon Oblinger, the companys president, is very concerned about the companys ability to maintain and sell the freshest products. She has also grown increasingly concerned about the companys cash management practices. She has accumulated the following inventory data: Spices $28,000 Coffee and Tea 61.060 Pasta 32,140 Vegetables 108,460 Health Supplements 84,700 Dairy 46,975 Meats 185,610 Personal Products 71,440 Household 88,200 Per Care 15,920 Ken Martin, cofounder and chief strategist, is equally concerned about the company, but he believes that specialty food shops that sell the companys products expect to b e able to order items from Colt Kitchen and have them shipped immediately. In short, Ken thinks that maintaining an adequate inventory is crucial to the companys future. Sharon and Ken have set a meeting for late next week to decide on the companys adoption of a just-in-time inventory management system. Sharon is proposing that inventory be reduced by 80 percent and that warehouse employment be decreased by 30 percent. Currently, the 10 warehouse employees earn an average gross pay of $350 per week. C. Assume that Colt Kitchen can invest cash that would otherwise be tied up in inventory. Calculate the potential interest income if the company were to receive an annual interest rate of 3.5 percent on the cash that would otherwise be invested in the inventory (represented by the 80 percent reduction)