What is approximate accounting rate of return for machine

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Reference no: EM13906185

A company is considering the purchase of a new machine for $28,000. Management predicts that the machine can produce sales of $12,000 each year for the next 10 years. Expenses are expected to include direct materials, direct labor, and factory overhead totaling $6,400 per year plus depreciation of $3,200 per year. The company's tax rate is 40%. What is the approximate accounting rate of return for the machine?

Reference no: EM13906185

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