Dahlia enterprises needs someone to supply it with 121000

Assignment Help Finance Basics

Reference no: EM13618027

Dahlia Enterprises needs someone to supply it with 121,000 cartons of machine screws per year to support its manufacturing needs over the next five years, and you've decided to bid on the contract. It will cost you $880,000 to install the equipment necessary to start production; you'll depreciate this cost straight-line to zero over the project's life. You estimate that in five years, this equipment can be salvaged for $71,000. Your fixed production costs will be $326,000 per year, and your variable production costs should be $10.40 per carton. You also need an initial investment in net working capital of $76,000. If your tax rate is 30 percent and your required return is 11 percent on your investment, what bid price should you submit?

Reference no: EM13618027

Questions Cloud

In a heart pacemaker a pulse is delivered to the heart 81 : in a heart pacemaker a pulse is delivered to the heart 81 times per minute. the capacitor that controls this pulsing

Find the market value after tax weighted average cost of : find the market value after tax weighted average cost of capital for a firm with 45m of equity has a required rate of

A defibrillator is used during a heart attack to restore : a defibrillator is used during a heart attack to restore the heart to its normal beating pattern. a defibrillator

A steam pipe is covered with 150 cm thick insulating : a steam pipe is covered with 1.50 cm thick insulating material with a thermal conductivity of 0.200

Dahlia enterprises needs someone to supply it with 121000 : dahlia enterprises needs someone to supply it with 121000 cartons of machine screws per year to support its

Alarge hot pizza 80 cm in diameter and 20 cm thick with a : a large hot pizza 80 cm in diameter and 2.0 cm thick with a temperature of 120degc floats in outer space. assume its

An investor has 50000 in a risky mutual fund and 30000 : an investor has 50000 in a risky mutual fund and 30000 invested in t-bills with a return of 5. the mutual fund has an

An analyst has modeled the stock of crisp trucking using a : an analyst has modeled the stock of crisp trucking using a two-factor apt model. the risk-free rate is 6 the expected

Compare your answer with the rate of energy transfer : a thermopane window consists of two glass panes each 0.50 cm thick with a 1.0 cm thick sealed layer of air in between.

User Account

All Pages