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Raab Company is expanding its production facilities to include a new product line, a sporty automotive tire rim. Tire rims can now be produced with

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Raab Company is expanding its production facilities to include a new product line, a sporty automotive tire rim. Tire rims can now be produced with little labor cost using new computerized machinery. The controller has advised management about two such machines. Details about each machine follow. Cost of machine Residual value Net income Annual net cash inflows The company's minimum rate of return is 12 percent. The maximum payback period is six years. For each machine, compute the projected accounting rate of return. (Round percentages to one decimal place.) Compute the payback period for each machine. (Round to one decimal place.) ACCOUNTING CONNECTION Based on the information from requirements 1 and 2, which machine should be purchased? Why

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