QUESTION 20 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 $12,000 per year including depreciation of $3,000 per year. Income tax expense is $1,600 per year based on a tax rate of 40%. What is the payback period for the new machine? 20.0 years O 8 9 years 7.5 years O 6.0 years O 12.0 years QUESTION 21 Which one of the following methods considers the time value of money in evaluating alternative capital expenditures? Payback period Return on average investment Net present value Accounting rate of return Cash flow method