Consider a project to supply 96 million postage stamps per year to the U.S. Postal Service for the next five years. You have an idle parcel of land available that cost $1,685,000 five years ago; if the land were sold today, it would net you $1,760,000 aftertax. The land can be sold for $1,744,000 after taxes in five years. You will need to install $5.15 million in new manufacturing plant and equipment to actually produce the stamps; this plant and equipment will be depreciated straight-line to zero over the project’s five-year life. The equipment can be sold for $565,000 at the end of the project. You will also need $555,000 in initial net working capital for the project, and an additional investment of $46,000 in every year thereafter. Your production costs are .44 cents per stamp, and you have fixed costs of $1,010,000 per year. If your tax rate is 22 percent and your required return on this project is 10 percent, what bid price should you submit on the contract? (Do not round intermediate calculations and round your answer to 5 decimal places, e.g., 32.16161.)
Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.
You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.Read more
Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.Read more
Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.Read more
Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.Read more
By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.Read more