Annual receipts Annual expenses $75,000 $45,000 8 years Terminal book value (EOY 8) S20,000 SO Useful life Terminal market value

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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.