The management of Ballard MicroBrew is considering the purchase of an automated bottling machine for $$71,000.$ The machine would replace an old piece of equipment that costs $$18,000$ per year to operate. The new machine would cost $$8,000$ per year to operate. The old machine currently in use is fully depreciated and could be sold now for a salvage value of $$26,000.$ The new machine would have a useful life of $10$ years with no salvage value.

Required:

$1.$ What is the annual depreciation expense associated with the new bottling machine?

$2.$ What is the annual incremental net operating income provided by the new bottling machine?

$3.$ What is the amount of the initial investment associated with this project that should be used for calculating the simple rate of return?

$4.$ What is the simple rate of return on the new bottling machine? $($Round your answer to $1$ decimal place i$.$e$.0\mathrm{.}123$ should be considered as $12\mathrm{.}3\%.)$