For the next year, you have collected some data relevant to the decision. Exhibit $20\mathrm{.}12$ shows cost information for the product when purchased from the supplier in China. Here we see that the cost for each sweater, delivered to the warehouse of our monogramming subcontractor, is $$59\mathrm{.}98.$ This price is valid for any quantity that we order above $5,000$ sweaters. This order can be a mix of sweaters for each of the five schools we are targeting. The supplier needs $20$ weeks to process the order, so the order needs to be placed around April $1$ for the upcoming football season.

Exhibit $20\mathrm{.}12$

COST INFORMATION FOR THE BIG TEN SWEATERS

China supplier cost

Material $ $30\mathrm{.}00$

Labor $11\mathrm{.}50$

Overhead $1\mathrm{.}25$

Transportation within China $1\mathrm{.}00$

Supplier profit $9\mathrm{.}05$

Agent's fee $2\mathrm{.}68$

Freight $($ocean carrier$)1\mathrm{.}50$

Duty, insurance, etc. $3\mathrm{.}00$

Total supplier cost $ $59\mathrm{.}98$

Domestic subcontractor cost

Monogram material $ $5\mathrm{.}00$

Labor $7\mathrm{.}00$

Total subcontractor cost $ $12\mathrm{.}00$

Total $($per sweater$)$ $ $71\mathrm{.}98$