The production department is proposing the purchase of an automatic insertion machine. It has identified three machines and has asked the accountant to analyze them to determine which one has the best average rate of return. Machine A Machine B Machine C $45,130.96 $83,087.40 $73,001.40 322,364.00 276,958.00 486,676.00 Estimated average income Average investment Oa. Machine B Ob. Machine C Oc. Machine A Od. Machines B and C have the same preferred average rate of return.

Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter19: Capital Investment
Section: Chapter Questions
Problem 16E: Covington Pharmacies has decided to automate its insurance claims process. Two networked computer...
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The production department is proposing the purchase of an automatic insertion machine. It has identified three machines and has asked the accountant to analyze them to determine
which one has the best average rate of return.
Machine A Machine B Machine C
$83,087.40 $73,001.40
322,364.00 276,958.00 486,676.00
Estimated average income $45,130.96
Average investment
Oa. Machine B
Ob. Machine C
Oc. Machine A
Od. Machines B and C have the same preferred average rate of return.
Transcribed Image Text:The production department is proposing the purchase of an automatic insertion machine. It has identified three machines and has asked the accountant to analyze them to determine which one has the best average rate of return. Machine A Machine B Machine C $83,087.40 $73,001.40 322,364.00 276,958.00 486,676.00 Estimated average income $45,130.96 Average investment Oa. Machine B Ob. Machine C Oc. Machine A Od. Machines B and C have the same preferred average rate of return.
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