Construction company is bidding

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Reference no: EM138877

Q. A construction company is bidding on a project comprising five high-rise buildings to be erected one after the other. The company considers the use of advanced, hydraulically operated tunnel forming systems to be purchased and used 60 times on each building over a 1-yr period of time. The tunnel forms cost $30/sf. No salvage value is expected at the end of the 5-yr project. As the two last buildings to be constructed slightly differ in their design, the forms will have to be modified at the cost of $6/sf. Periodical maintenance is expected every 120 uses at a cost of 4% of the purchase cost. Consider an annual interest rate of 10%. What is the expected average material cost per sf for each use?

Reference no: EM138877

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