A mechanical engineer at Anode Metals is considering five equivalent projects, some of which have different life expectations. Salvage value is nil for all alternatives. Assuming that the company’s MARR is 13% per year, determine which should be selected (a) if they are independent, and (b) if they are mutually exclusive. (c) Explain why your selection in part (b) is correct. First Cost, $ Net Annual Income, $/Year Life, Years A −20,000 +5,500 4 B −10,000 +2,000 6 C −15,000 3,800 6 D −60,000 +11,000 12 E −80,000 +9,000 12

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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.