0
The AAR is good capital budgeting tool because managers can compare it to objective benchmarks. Yet one limitation is that ARR uses profit rather than cashflows, and it does not account for the time value of money (TVM)
For more information on the accounting rate of return (AAR) please visit: http://www.drtaccounting.com/2008/03/calculate-average-accounting-return.html
What else can I help you with?
The accounting rate of return on stockholders investments is measured by?
The accounting rate of return stockholders investments is measured by?
Limitation of accounting rate of return?
outline four limitation of the accounting rate of return method of appraising new investment.
Limitation of accounting information?
The limitations of accounting information Despite the usefulness of accounting information, there are some limitations: 1. An accountin
Are accounting rate of return and payback period non discount cashflow methods?
YES
What are the various limitations of business accounting data?
I would like to know what the limitations of business and accounting data is? I would like to know Accounting as a language of business suffers from which serious limitations?
The accounting rate of return on stockholders investments is measured by?
The accounting rate of return stockholders investments is measured by?
Limitation of accounting rate of return?
outline four limitation of the accounting rate of return method of appraising new investment.
How is the accounting rate of return on stockholders investments measured?
return on equity
What are the differences between accounting rate of return and internal rate of return?
Internal rate of return (IRR) is a discounted method used for Capital budgeting decisions (investment etc) while accounting rate of retun is a measure for calculating return for a one off payment. IRR is actually the discount rate that equates the Present value of the cash flows to the NPV of the project (investment) while accounting rate of return just gives the actual rate of return. Habib topu1910@gmail.com
What are the three capital expenditure techniques?
Internal rate of return, net present value, accounting rate of return and payback method.
Limitation of accounting information?
The limitations of accounting information Despite the usefulness of accounting information, there are some limitations: 1. An accountin
Are accounting rate of return and payback period non discount cashflow methods?
YES
Why you use average invetsment in accounting rate of return technique?
If the investment is derived from income, look at the return and make a choice
True or FalseBoth the IRR rule and the accounting rate of return rule take into consideration the time value of money?
accounting rate of return not take into consideration the time value of money as regrading to actual financial statements which prepare on the historical cost
What are the various limitations of business accounting data?
I would like to know what the limitations of business and accounting data is? I would like to know Accounting as a language of business suffers from which serious limitations?
What efforts are made to overcome accounting limitations?
what efforts have been made to overcome the limitations of financial accounting
Accounting as business language suffers serious limitations. What are these limitations and what efforts are being made to remove them?
Accounting as business language suffers serious limitations. What are these limitations and what efforts are being made to remove them?
