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help!!!! With calculation please!!! Imagine that a new cell phone company has asked you to create a bid for 1 new cell tower per year,
help!!!! With calculation please!!!
Imagine that a new cell phone company has asked you to create a bid for 1 new cell tower per year, for 3 years. The project will require you purchase $420,000 in new equipment, which you will depreciate strait-line to zero over seven years. At the end of the project, you expect to sell the equipment for $300,000. You will need to rent additional warehouse space, at a cost of $50,000 per year. The cost of labor and materials will be $100,000 per tower. Your corporate tax rate is 20%. Assume there are no implications for net working capital. What is the minimum bid you could submit to ensure you make a 10% required return on the project? Give your answer as the price per cell tower, not the entire projectStep by Step Solution
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