You Are Working on a Bid to Build Two Apartment

question 21

Multiple Choice

You are working on a bid to build two apartment buildings a year for the next three years. This project requires the purchase of $847,000 of equipment that will be depreciated using straight-line depreciation to a zero book value over the project's life. Ignore bonus depreciation. The equipment can be sold at the end of the project for $415,000. You will also need $165,000 in net working capital over the life of the project. The fixed costs will be $528,000 a year and the variable costs will be $1,640,000 per building. Your required rate of return is 16 percent for this project and your tax rate is 24 percent. What is the minimal amount, rounded to the nearest $100, you should bid per building?

• A) $4,158,400
• B) $4,489,500
• C) $2,065,700
• D) $2,780,600
• E) $2,244,800

Describe the composition and function of the subcutaneous layer.

Understand the factors influencing baldness and hair color changes.

Identify the anatomical structure of hair and hair growth factors.

Understand the role of adipose tissue in the subcutaneous layer.

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Definitions:

Lock Box

A banking service provided to companies for the collection of payments from customers, where the payments are sent directly to a post office box, then quickly processed by the bank.

Mail Float

The time delay between when a check is written and mailed, and when the recipient actually receives and processes the payment.

Processing Float

The time difference between when a payment is made and the funds are actually available in the payee's account.

Credit Policy

Guidelines that govern a company's extension of credit to customers, determining who is eligible and on what terms.