What is the minimum bid price the firm should set

Assignment Help Accounting Basics
Reference no: EM133033763

Question - The managers of PonchoParts, Inc. plan to manufacture engine blocks for classic cars from the 1960s era. They expect to sell 250 blocks annually for the next five years. The necessary foundry and machining equipment will cost a total of $800,000 and belongs in a 30% CCA class for tax purposes. The firm expects to be able to dispose of the manufacturing equipment for $150,000 at the end of the project. Labour and materials costs total $500 per engine block, fixed costs are $125,000 per year. Assume a 35% tax rate and a 12% discount rate. What is the minimum bid price the firm should set as a sale price for the blocks if the firm were in a bidding situation?

Reference no: EM133033763

Questions Cloud

Find population standard deviation : Suppose the mean height in inches of all 9th grade students at one high school is estimated. The population standard deviation is 3 inches.
Development of teamwork skills : Apply strategies for effective change management with individuals, teams and organisations and Analyse the relationship among leadership, power, ethics, values
Problems of changing the culture of a business : If you were appointed to a management position in a well-known business, what evidence would you need to identify the culture of the organization?
Disadvantages of very cohesive groups-teams : Describe several advantages and disadvantages of very cohesive groups/teams.
What is the minimum bid price the firm should set : Assume a 35% tax rate and a 12% discount rate. What is the minimum bid price the firm should set as a sale price for the blocks
Competitive forces beyond meat faces : What is the assessment of the strengths of the competitive forces Beyond Meat faces? Can you please explain using the five forces analysis to support your answe
Calculate a depreciation schedule : Calculate a depreciation schedule for each of the depreciating assets. How much can Cam industries claim in depreciation for the close of the 2021-22 financial
What is the roi : Your spouse would like to add an addition to the home. The home was originally purchased for $175,000. What is the ROI (write as a percentage)
Identify two issues challenging hong kong disneyland : Identify two issues challenging Hong Kong Disneyland's current operations and propose corresponding solutions.

Reviews

Write a Review

Accounting Basics Questions & Answers

  The raab company is expanding its production facilities to

the raab company is expanding its production facilities to include a new product line a sporty automotive tire rim.

  The sales warranty accrual method

Landcaster, Inc., sells its products with a service contract.

  Indicate the balances in the three stockholders equity

on october 1 chile corporations stockholders equity is as follows.common stock 4 par

  A company purchased 2000 of merchandise on nov 2 with terms

a company purchased 2000 of merchandise on nov. 2 with terms 210 n30. on nov. 8 it returned 500 worth of merchandise.

  What type of company may have large positive net cash

what type of company may have large positive net cash provided by operating activities?what type of company may have

  How does a banker acceptance help create

Pays RM0.16 per year in dividends. The analyst on Bursa Malaysia predicts that the stock will be selling for RM60 in one year. Should you buy this stock?

  Explain each of the three costing systems in accounting

Product costing systems are methods used to manage inventories. Briefly explain each of the three costing systems in accounting

  Which refers to no tax assessed on earnings in the account

Which refers to no tax assessed on the earnings in the account in the year that the earnings are received? Traditional IRA withdrawal.

  Compute present value of the bids

The annual maintenance cost on this surface is estimated at 25 cent per square yard for each year except last year of its service. Compute present value of bids

  Record the above transactions directly into the t accounts

Record the above transactions directly into the T accounts. To the left of the amount entered in the accounts, place appropriate letter to identify transaction

  What are the estimated total monthly fixed costs

CableVision has been approached by the City of Mirada to run its cable operations in 2019. What are the estimated total monthly fixed costs

  What is the total cost of producing a single box

The budgeted hours for a factory is 11700 while its estimated total overhead is $49800. What's the total cost of producing a single box

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!

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