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The Rhodes Company has two operating divisions. The company evaluates the performance of its divisions using the return on investment (ROI) measure. The following is information for the Service Division at the end of the year.
Service Division
Units repaired 8,000
Level of investment 400,000
Operating Expenses:
Direct Materials 40,000
Direct Labor 200,000
Overhead 25,000
Selling & Admin 15,000
Total Operating Expenses $280,000
The average service fee was $50 per unit. What was the Service Department's ROI for the year? (round to the nearest whole percent)
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