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I posted about how I migrate an old Mac to a new Mac in a previous post.
After migration, I also wanted to do a clean install on the old Mac, and bring it to factory settings, but with the latest OS X (Mountain Lion for me).
It is very easy.
The steps:
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Restart computer and press Command + R while it restart to get to a menu screen
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Select Disk Utility > Macintosh HD (your startup volume) > Erase
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Go back to menu screen and select Install Mac OS X
Follow through and it will be done!