Which One of the Following Is an Advantage of the Accounting

question 61

Multiple Choice

Which one of the following is an advantage of the accounting (book) rate of return (ARR) method for analyzing capital investment proposals?

• A) It is not affected by different accounting methods.
• B) It is precise and objective.
• C) Data for calculating the return are typically readily available.
• D) The method explicitly adjusts for the time value of money.
• E) ARR is generally approximately equal to a project's internal rate of return (IRR).

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Definitions:

Currency Exchange Rates

The worth of a currency in exchange for a different currency.

Equivalent Amount

The equal value of currency or expression of a sum in a different form or denomination, maintaining its value.

C$ Strengthens

When the Canadian dollar increases in value compared to other currencies.

£0.0021

A specific monetary value in British pounds, often representing a small amount of money.