What is the average accounting rate of return (ARR) on a piece of equipment that will cost $984,000 and that will result in pretax cost savings of $312,000 for the first three years and then $230,000 for the following three years? Assume that the machinery will be depreciated to a salvage value of 0 over six years using the straight-line method and the companys tax rate is 32 percent. (Round final answer to 1 decimal place, e.g. 527.5.)

1) Average accounting rate of return (%)

2) If the acceptance decision is based on the project exceeding an ARR of 20 percent, should this machinery be purchased?