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Johnson Company calculated the net present value on a new machine to be $71,543. The new machine would cost $95,000 and would have a salvage
Johnson Company calculated the net present value on a new machine to be $71,543. The new machine would cost $95,000 and would have a salvage value of $9,800 at the end of its 10-year life. The old machine currently in use can be sold for $3,000 if the new machine is purchased. Assume Johnson Company has a 10% cost of capital. Calculate the accounting rate of return on the new machine
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