User Account

All Pages

What bid price should you submit

Assignment Help Finance Basics
Reference no: EM132556917

Guthrie Enterprises needs someone to supply it with 145,000 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 $3 million to install the equipment necessary to start production; you'll depreciate this cost straight-line to zero over the project's life. The market value of the retired machine is zero. Your production costs will be $1,955,000 per year. You also need an initial investment in net working capital of $325,000, which will be fully recovered in the end of the project. If your tax rate is 20 percent and you require a 10 percent return on your investment, what bid price should you submit?

Reference no: EM132556917

Questions Cloud

Brand-loyal decision making-repeat purchase decision making : What products generally are associated with brand-loyal decision making and which with repeat-purchase decision making?
What return should you expect on your portfolio : Suppose you hold a portfolio that consists of 35% in Microsoft Co. stock, 35% in Treasury bills, what return should you expect on your portfolio
How much Part IV tax must GIC pay : Gupta Investments Corp. (GIC) was incorporated to be an investment holding company with a December 31 year end. How much Part IV tax must GIC pay
Define organizational development and organizational culture : Prepare an annotated bibliography of articles collected to date on the topic selected. You will be required to prepare an annotated bibliography with some.
What bid price should you submit : Guthrie Enterprises needs someone to supply it with 145,000 cartons of machine screws per year to support its manufacturing
Inventory and staffing : Discuss three inventory factors that you believe could present problems for a business. Outline a strategic plan for hiring and retaining competent,
Describe the young entrepreneurs vision or idea : Choose ONE Young Entrepreneur under the age of 30 and answer the following questions: Describe the young entrepreneurs' vision or idea. State name, age.
Develop succession plan or exit strategy for business : Develop a succession plan or exit strategy for a business. Within your response, be sure to discuss which elements are essential to this succession plan
An empirical study on wealth creation : An Empirical Study on Wealth Creation through Acquiring Companies - A Performance Case of the British Petroleum Co PLC

Reviews

Write a Review

Finance Basics Questions & Answers

  The securities and exchange commission sec became concerned

rules governing the investment practices of individual certified public accountants prohibit them from investing in the

  Discuss the probability versus risk trade-offs associated

discuss the probability versus risk trade-offs associated with alternative levels of working capital

  Real return on investment for a coupon bond

You bought one of BB Co.'s 9% coupon bonds one year ago for $1020. These bonds make annual payments and mature six years from now. Suppose you decide to sell your bonds today, when the required return on the bonds is 10%. If the inflation rate was..

  What is the probability of a positive net present value

There is a .7 probability that competitors will respond. What is the probability of a positive net pres-ent value?

  Total return for investment

He also received total capital gain distributions of $1.60 per share. At the end of three years, he sold his shares for $36 a share.

  What will one share of this common stock be worth

The company adheres to a constant rate of growth dividend policy. What will one share of this common stock be worth 11 years from now if the applicable discount rate is 8.0 percent?

  Discuss the example of price discrimination

Identify whether each of the following is an example of price discrimination. Explain your answers.

  Computing the after-tax cost of debt

LL Incorporated's currently outstanding 11% coupon bonds have a yield to maturity of 8%. LL believes it could issue new bonds at par that would provide a similar yield to maturity. If its marginal tax rate is 35%, what is LL's after-tax cost of de..

  Share repurchases and dividends

What are two main differences between share repurchases and dividends that are not related to tax, but that a firm may find important. (explain if you could).

  Annual end-of-year payments

A $50,000 loan is to be amortized over 7 years, with annual end-of-year payments. Which of these statements is CORRECT?

  Total percentage return of stock investment

What is the total percentage return of your stock investment?

  Suppose there is a financial asset abc which is the

suppose there is a financial asset abc which is the underlying asset for a futures contract with settlement six months

Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

Submit Assignment

Academics

Major Subjects

Majors

Get In Touch

whatsapp: +1-415-670-9521

Phone: +1-415-670-9521

Email: [email protected]

TERMS & POLICIES

HELP & SUPPORT

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd