Question

A company is considering the purchase of a new machine for $48,000. Management predicts that the machine can produce sales of $16,000 each year for the next 10 years. Expenses are expected to include direct materials, direct labor, and factory overhead totaling $8,000 per year including depreciation of $4,000 per year. Income tax expense is $3,200 per year based on a tax rate of 40%. What is the payback period for the new machine

Answer 1

The accounting rate of return is 10%

Step-by-step explanation:

I hope this helps you! :D