Business, 30.07.2021 04:20 bonnysvalentine

The owner of a small pipeline construction company wants to determine how much he should bid in his attempt to win his first "big" contract. He estimates that his cost to complete the project will be $7.2 million in PW equivalency. He wants to bid an amount that will generate an after-tax rate of return of 15% per year; however, he doesn’t know how much to bid on a before-tax basis. He told you that his effective state tax rate is 12% and his effective federal tax rate is 22% per year. (a) The equation for determining the overall effective tax rate is:
state rate + (1 − state rate)(federal rate)
Determine his before-tax MARR in order to realize an after-tax MARR of 15% per year.
(b) How much should he bid?

Answers: 2

Show answers

Other questions on the subject: Business

Business, 22.06.2019 19:50, Salas1333

Which of the following would create the most money? the initial deposit is $6,500 and the required reserve ratio is 20 percent. the initial deposit is $3,000 and the required reserve ratio is 10 percent. the initial deposit is $7,500 and the required reserve ratio is 25 percent. the initial deposit is $4,500 and the required reserve ratio is 15 percent.

Answers: 1

continue

Business, 22.06.2019 21:10, dooboose15

Which of the following statements is (are) true? i. free entry to a perfectly competitive industry results in the industry's firms earning zero economic profit in the long run, except for the most efficient producers, who may earn economic rent. ii. in a perfectly competitive market, long-run equilibrium is characterized by lmc < p < latc. iii. if a competitive industry is in long-run equilibrium, a decrease in demand causes firms to earn negative profit because the market price will fall below average total cost.

Answers: 3

continue

Business, 22.06.2019 21:10, stephany94

You are the manager of a large crude-oil refinery. as part of the refining process, a certain heat exchanger (operated at high temperatures and with abrasive material flowing through it) must be replaced every year. the replacement and downtime cost in the first year is $165 comma 000. this cost is expected to increase due to inflation at a rate of 7% per year for six years (i. e. until the eoy 7), at which time this particular heat exchanger will no longer be needed. if the company's cost of capital is 15% per year, how much could you afford to spend for a higher quality heat exchanger so that these annual replacement and downtime costs could be eliminated?

Answers: 1

continue

Business, 22.06.2019 22:30, jyworthy

Ski powder resort ends its fiscal year on april 30. the business adjusts its accounts monthly, but closes them only at year-end (april 30). the resort's busy season is from december 1 through march 31. adrian pride, the resort's chief financial officer, the museums a close watch on lift ticket revenue and cash. the balances of these accounts at the end of each of the last five months are as follows:

Answers: 3

continue

You know the right answer?

The owner of a small pipeline construction company wants to determine how much he should bid in his...