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 4,300 units at $319 per unit. The equipment has a cost of $399,900, residual value of $30,100, 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 $54.00 Direct materials 209.00 Factory overhead (including depreciation) 35.50 Total cost per unit $298.50 Determine the average rate of return on the equipment. If required, round to the nearest whole percent. %. please answer do not image.
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 4,300 units at $319 per unit. The equipment has a cost of $399,900, residual value of $30,100, 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 $54.00 Direct materials 209.00 Factory overhead (including depreciation) 35.50 Total cost per unit $298.50 Determine the average rate of return on the equipment. If required, round to the nearest whole percent. %. please answer do not image.
Managerial Accounting
15th Edition
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:Carl Warren, Ph.d. Cma William B. Tayler
Chapter12: Capital Investment Analysis
Section: Chapter Questions
Problem 3E: Average rate of returnnew product Hana Inc. is considering an investment in new equipment that will...
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