Santana Rey is considering the purchase of equipment for Business Solutions that would allow the company to add a new product to its computer furniture line. The equipment is expected to cost $371,000 and to have a seven-year life and no salvage value. It will be depreciated on a straight-line basis. Business Solutions expects to sell 100 units of the equipments product each year. The expected annual income related to this equipment follows. Sales $ 382,000 Costs Materials, labor, and overhead (except depreciation) 192,000 Depreciation on new equipment 53,000 Selling and administrative expenses 36,000 Total costs and expenses 281,000 Pretax income 101,000 Income taxes (35%) 35,350 Net income $ 65,650

Compute the accounting rate of return for this equipment.