Question: ANSWER ONLY IN THE FORMAT PLEASE! THE THREE EXCEL SHEETS ARE BELOW THE QUESTION AN ANSWER NOT IN THOSE EXCEL SHEETS IS NOT ACCEPTED OCF

ANSWER ONLY IN THE FORMAT PLEASE!

THE THREE EXCEL SHEETS ARE BELOW THE QUESTION

AN ANSWER NOT IN THOSE EXCEL SHEETS IS NOT ACCEPTED

OCF SHEET IS BLANK BUT WORK STILL REQUIRED

ANSWER ONLY IN THE FORMAT PLEASE! THE THREE EXCEL SHEETS ARE BELOWTHE QUESTION AN ANSWER NOT IN THOSE EXCEL SHEETS IS NOT ACCEPTEDOCF SHEET IS BLANK BUT WORK STILL REQUIRED Alton Enterprises needs someoneto supply it with 150,000 cartons of machine screws per year to

Alton Enterprises needs someone to supply it with 150,000 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 $425,000 to install the equipment necessary to start production; you will depreciate this cost straight-line to zero over the project's life. You estimate that in five years, this equipment can be salvaged for $50,000. Your fixed production costs will be $150,000 per year, and your variable production costs should be $6 per carton. You also need an initial investment in net working capital of $60,000. If your tax rate is 34 percent and you require at least a 20 percent return on your investment, calculate the lowest bid price you can submit (and not suffer from the winner's curse). Inputs Project Length Initial Outlay NWC. Salvage Value Fixed Costs Unit Price Unit Variable Cost Unit Sales Depreciation Tax Rate Required Return Plagiarism Inputs OCF FCF + Plagiarism Inputs OCF FCF + Year 0 1 2 3 4 5 Initial Investment OCF ANWC After-tax Salvage FCF NPV Bid Price Plagiarism Inputs OCF FCF + Alton Enterprises needs someone to supply it with 150,000 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 $425,000 to install the equipment necessary to start production; you will depreciate this cost straight-line to zero over the project's life. You estimate that in five years, this equipment can be salvaged for $50,000. Your fixed production costs will be $150,000 per year, and your variable production costs should be $6 per carton. You also need an initial investment in net working capital of $60,000. If your tax rate is 34 percent and you require at least a 20 percent return on your investment, calculate the lowest bid price you can submit (and not suffer from the winner's curse). Inputs Project Length Initial Outlay NWC. Salvage Value Fixed Costs Unit Price Unit Variable Cost Unit Sales Depreciation Tax Rate Required Return Plagiarism Inputs OCF FCF + Plagiarism Inputs OCF FCF + Year 0 1 2 3 4 5 Initial Investment OCF ANWC After-tax Salvage FCF NPV Bid Price Plagiarism Inputs OCF FCF +

Step by Step Solution

There are 3 Steps involved in it

1 Expert Approved Answer
Step: 1 Unlock blur-text-image
Question Has Been Solved by an Expert!

Get step-by-step solutions from verified subject matter experts

Step: 2 Unlock
Step: 3 Unlock

Students Have Also Explored These Related Finance Questions!