5. Carlyle Inc. is considering two mutually exclusive projects. Both require an initial investment of $14,800 at t = 0. Project S has an expected life of 2 years with after-tax cash inflows of $7,200 and $12,700 at the end of Years 1 and 2, respectively. In addition, Project S can be repeated at the end of Year 2 with no changes in its cash flows. Project L has an expected life of 4 years with after-tax cash inflows of $5,600 at the end of each of the next 4 years. Each project has a WACC of 9%. What is the equivalent annual annuity of the most profitable project? a. 1,418.24 b. 1,042.02 c. 1,560.06 d. 1,162.96 e. 1,031.70

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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.