Alson enterprises needs someone to supply it with 168000


Alson Enterprises needs someone to supply it with 168,000 cartons of machine screws per year to support its manufacturing needs over the next 4 years, and you've decided to bid on the contract. It will cost you $873,600 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 4 years, this equipment can be salvaged for $56,000. Your fixed production costs will be $268,800 per year, and your variable production costs should be $9.52 per carton. You also need an initial investment in net working capital of $84,000, all of which will be recovered at the end of the project. If your tax rate is 33 percent and you require a 17 percent return on your investment, you should submit a bid price per unit of $____?

Request for Solution File

Ask an Expert for Answer!!
Financial Accounting: Alson enterprises needs someone to supply it with 168000
Reference No:- TGS01075627

Expected delivery within 24 Hours