While evaluating a project that costs $2.58 million having 4 years life has no salvage value. Estimated sales at $1400000 per year, price per unit is 20$, variable cost per unit is 12.5$ and fixed cost $90,000 per year. The tax rate and the required rate of return is 18% and 11% respectively. 1- Find base CF 2-Find Base NPV 3-find NPV change for 300 unit decrease in projected sales

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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.