X A~ A E Normal 1 No Spac... Heading 1 Heading 2 Gc Replace Title ont Select Paragraph IS Styles Editing SUNWAY Bhd. is considering to bid a contract to supply clay pipes to HOLY Construction. HOLY plans to purchase 2,000 clay pipes each year for the coming three years. To begin this contract, SUNWAY will need a manufacturing equipment which cost RM165,000. This equipment will depreciate on straight-line basis over its five-year life. At the end of third year, the after-tax salvage value is RM65,000. Additional fixed cost is RM45,000 each year while variable cost is RM12 per clay pipe. An additional investment of RM55,000 in net working capital is required at the beginning of the contract. The firm's tax rate is 25 percent and the cost of capital is 13 percent. Compute the price for each clay pipe that SUNWAY could offer to HOLY Construction when it can still create value for its shareholders D Focus W O earch