Pizza-making equipment did not qualify for the Arizona transaction privilege and use tax manufacturing exemption. To qualify for the exemption, the equipment must be used directly in a manufacturing or processing operation. Although the manufacturing of the pizza may have transformed personal property into a different product, the purpose of the exemption is to encourage manufacturing businesses and investment in manufacturing equipment. Thus, the restaurant business’s equipment remained taxable as it is truly used for fostering the restaurant business and not manufacturing. (Arizona Department of Revenue v. Blue Line Distributing, Inc., Arizona Court of Appeals, Div. One, No. 1 CA-TX 01-0011, April 4, 2002)