A Weakness with the Accounting Rate of Return Is That

question 46

Multiple Choice

A weakness with the accounting rate of return is that it:

• A)does not provide an indication of the risk of a project.
• B)is based on accounting earnings rather than cash flows.
• C)ignores the timing of earnings.
• D)All of the given answers are weaknesses.

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Definitions:

Stubborn

Showing dogged determination not to change one's attitude or position on something, especially in spite of good arguments or reasons to do so.

Judgmental

Characterized by or involving the use or expression of judgment, especially critical or negative judgment.

Rubric

A guide consisting of specific criteria used for assessment or grading.