Average rate of return$$new product

Oahu Inc. is considering an investment in new equipment that will be used to manufacture a smartphone. The phone is expected to generate additional annual sales of $6,300$ units at $$309$ per unit. The equipment has a cost of $$703,100,$ residual value of $$52,900,$ and an $8-$year life. The equipment can only be used to manufacture the phone. The cost to manufacture the phone follows:

Line Item Description Amount

Cost per unit:

Direct labor $$54\mathrm{.}00$

Direct materials $208\mathrm{.}00$

Factory overhead $($including depreciation$)35\mathrm{.}60$

Total cost per unit $$297\mathrm{.}60$

Determine the average rate of return on the equipment. If required, round to the nearest whole percent.

fill in the blank $1$ of $1\%$