Chapter 26 Homework eBook Show Me How Average Rate of Return-New Product Hana 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 4,700 units at $235 per unit. The equipment has a cost of $480,800, residual value of $36,200, and an 8-year life. The equipment can only be used to manufacture the phone. The cost to manufacture the phone follows: Cost per unit: Direct labor $39.00 153.00 Direct materials Factory overhead (including depreciation) 25.95 Total cost per unit $217.95 Determine the average rate of return on the equipment. If required, round to the nearest whole percent. % Check My Work Previous Next