Average rate of return OBJ. 2 The following data are accumulated by ChemLab Inc. in evaluating two competing capital investment proposals:

Testing Equipment Vehicle Amount of investment $86,000 $30,000 Useful life 6 years 8 years Estimated residual value 0 0 Estimated total income over the useful life $18,060 $12,000 Determine the expected average rate of return for each proposal.