Need help with this question. Please do not answer with a picture of a spreadsheet and then formulas for each cell in the spreadsheet.

Show all of your steps one by one and clearly show your thinking to explain the answer.

Again, spreadsheet answers are not accepted thanks.

Caldwell Supply, a wholesaler, has determined that its operations have three primary activities: purchasing, warehousing, and

distributing. The firm reports the following operating data for the year just completed:

Caldwell buys $101,200$ units at an average unit cost of $$11$ and sells them at an average unit price of $$21.$ The firm also has fixed

operating costs of $$251,200$ for the year.

Caldwell's customers are demanding a $11\%$ discount for the coming year. The company expects to sell the same amount if the demand

for price reduction can be met. Caldwell's suppliers, however, are willing to give only a $3\%$ discount.

Required:

Caldwell has estimated that it can reduce the number of purchase orders to $800$ and can decrease the cost of each shipment by $$15$

with minor changes in its operations. Any further cost savings must come from reengineering the warehousing processes. What is the

maximum cost $($i$.$e$.,$ target cost$)$ for warehousing if the firm desires to earn the same amount of profit next year?