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 $6,000$ units at $$275$ per unit. The equipment has a cost of $$502,200,$ residual value of $$37,800,$ 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 $$46\mathrm{.}00$

Direct materials $181\mathrm{.}00$

Factory overhead $($including depreciation$)30\mathrm{.}90$

Total cost per unit $$257\mathrm{.}90$

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

fill in the blank $1$ of $1$

$\%$