Why Would a Company Use the Accounting Rate of Return

question 36

Multiple Choice

Why would a company use the accounting rate of return?

• A)to ensure that a new investment will not adversely affect accounting income
• B)because it does not consider the time value of money
• C)because it is a measure of liquidity
• D)all of the above

---

Definitions:

Commission

A fee paid to an agent or employee for facilitating a sale or service.

Real Estate Agent

A licensed professional who represents buyers or sellers in real estate transactions.

Transaction

A business deal or exchange between two or more parties, which can involve the transfer of goods, services, money, or information.

Torrens System

The Torrens system is a method of registering titles to land, named after Sir Robert Torrens, designed to simplify land transactions and provide clear ownership.