Chapter 25 Homework Average Rate of Return-New Product Galactic 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 5,200 units at $234 per unit. The equipment has a cost of $580,300, residual value of $43,700, and an eight-year life. The equipment can only be used to manufacture the phone. The cost to manufacture the phone follows: Cost per unit: Direct labor $39.00 Direct materials Factory overhead (including depreciation) 25.20 Total cost per unit 5214.20 Determine the average rate of return on the equipment. If required, round to the nearest whole percent % Check My Word Next >