What is the minimum price per carton that you should bid

Assignment Help Accounting Basics
Reference no: EM133092212

Question - ABC Corp. has decided to ask suppliers to bid on the 50,000 cartons of precision machine screws that ABC Corp. needs to purchase per year to support its manufacturing needs over the next five years. You have decided to submit a bid to supply the machine screws.

-It will cost you $800,000 to install the necessary equipment which will be fully depreciated over a straight line basis over five years (means salvage value will be zero at the end of the fifth year). 

-Incremental Selling, General & Administrative expense will be $150,000 a year and variable costs will be $9.50 per carton.

-For simplicity, assume the level of net working capital equals zero from Year 0 to Year 5. 

-The project has a 10% cost of capital and a 21% tax rate.

What is the minimum price per carton that you should bid?

Reference no: EM133092212

Questions Cloud

Purchasing and supply management role : Analyze the external forces affecting purchasing and supply management's role and required contributions to a firm's success.
Explore how to utilize survival measures : In this assignment, explore how to utilize survival measures as a method of measuring cost and effectiveness
Analyze sales for different models : Consider companies like Whirlpool or Frigidaire who manufacture and sell dishwasher appliances to retailers. Suppose you are one of these retailers, operating u
Describe the key features of the graph : Profit that Blackberry makes on selling tablets is represented by the following equation with profit being P(b) and b being number of blackberry phones sold
What is the minimum price per carton that you should bid : Administrative expense will be $150,000 a year and variable costs will be $9.50 per carton. What is the minimum price per carton that you should bid
What is a line of credit : What is a Line of Credit? Describe the Characteristics of Preferred Stock. What are Mutual Funds?
Highlight range of environmental and resource hazards : Highlight the range of environmental and resource hazards that exist within the workplace and the environmental legislations, regulations, and codes of practice
Types of e-commerce : MDEC envisions playing a leading role in catalyzing this transition to Malaysia 5.0 as a new narrative for introducing emerging technologies which are essential
Compute the factory overhead flexible-budget variance : Compute the factory overhead flexible-budget variance, the factory overhead spending variance, and the efficiency variance for variable factory overhead

Reviews

Write a Review

Accounting Basics Questions & Answers

  How much income does Clown have from this distribution

Circus distributes cash of $75,000 to Clown on the last day of the tax year. How much income does Clown have from this distribution

  Find revaluation surplus in equity section of Light Compnay

Find the revaluation surplus in the equity section of Light Company's December 31, 20x8 statement of financial position

  What will be the standard total labor cost

Ajay Inc. produces metal axels. The sales budget for the next four months is: January 6,500 units, What will be the standard total labor cost for month of March

  Determine compute ending inventory and cost of goods sold

Compute ending inventory and cost of goods sold for the quarter ending March 31, 2020 using FIFO method and LIFO method.

  How much will purple lemon shipbuilders inc pay per share

How much will Purple Lemon Shipbuilders Inc. pay per share to the underwriter? Based on this information, what is Purple Lemon Shipbuilders Inc.'s cost.

  Calculate net income and ending balance of retained earnings

These items are taken from the financial statements of Carla Vista Ltd, Calculate net income and the ending balance of retained earnings at December 31, 2018

  Determining the bond approaches maturity

State whether each component will increase (I), decrease (D), or remain constant (C) as the bond approaches maturity given the following situations:

  Write a memo to the budget managers in an organization

Write a memo to the budget managers in an organization, assuming you are the CEO. Your memo should direct budget managers not to utilize this approach

  Assume that the company closes its books on december

Prepare an income statement, statement of changes in equity, balance sheet and statement of cash flows for each of the 2013, 2014, 2015, and 2016 accounting periods.

  Hobart beverage company uses the weighted-average method

Hobart Beverage Company uses the weighted-average method in its process costing system. Materials are included at the start of the production process but conversion costs are uniformly applied throughout the production process.

  Record the journal entries for the truck sold

Prepare the journal entries to record the two exchange transactions. Determine and Record the journal entries for the truck sold on August 18

  Make the consolidation journal entries for the year ended

Geelong Ltd acquired 80 per centa cost of $1,500,000carrying amount of $150,000 less. Make the consolidation journal entries for the year ended

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