Machine “A” has a starting cost of $ 50,000 with an estimated period of 12 years and a salvage value of $ 14,000. Annual O&M costs are $ 6,000 the first year, $ 6,300 the second year, and so on. Another Alternative is machine “B” which has an initial cost of $ 30,000 and a recovery value of $ 3,000 at the end of the 12-year service period, the annual operating and maintenance expenses are $ 8,000 the first year, from $ 8,500 the second year and so on. Using an interest rate of 13% per year. Do a Present Value analysis, and determine the value of machine A Possible results   $88,760.84 $89,543.09 $88,543.09

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Production Budget

A budget can be defined as a financial plan designed by an undertaking for a definite period in the future that can contribute towards enhancing the financial success of the business undertaking. It is used to estimate the revenue and expenses. The budget generally takes into account both current and future income and expenses.