Blue Marlin Company is considering the purchase of new equipment for its factory. It will cost $245,000 and have a $49,000 salvage value in five years. The annual net income from the equipment is expected to be $29,400, and depreciation is $39,200 per year. Calculate Blue Marlin's annual rate of return and payback period for the equipment. (Do not round intermediate calculations. Round your Payback Period to 2 decimal places.) TAT 12 % Annual Rate of Return Payback Period Years

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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.