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60.ThemanagerofMalanPtyLtdwantstobuyanewmachinetoreplacetheonecurrentlybeingused.Thenewmachinewillcost$100000withnodisposalvalueattheendofafive-yearusefullife.Themanagerestimatesthatthemachinewillreduceannualoperatingcostsby$30000.Depreciationwillbe$20000peryearforfiveyears.Thetaxrateforeachyearisexpectedtobe20percentandthecompanyhasanafter-taxhurdlerateof12percent.Whatistheafter-taxaccountingrateofreturncomputedbasedontheinitialinvestment? Selectone: a. 8% b. 20% c. 4% d. 10%

60.ThemanagerofMalanPtyLtdwantstobuyanewmachinetoreplacetheonecurrentlybeingused.Thenewmachinewillcost$100000withnodisposalvalueattheendofafive-yearusefullife.Themanagerestimatesthatthemachinewillreduceannualoperatingcostsby$30000.Depreciationwillbe$20000peryearforfiveyears.Thetaxrateforeachyearisexpectedtobe20percentandthecompanyhasanafter-taxhurdlerateof12percent.Whatistheafter-taxaccountingrateofreturncomputedbasedontheinitialinvestment? Selectone: a. 8% b. 20% c. 4% d. 10%

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