Which One of the Following Correctly Applies to the Average

question 108

Multiple Choice

Which one of the following correctly applies to the average accounting rate of return?

• A)It considers the time value of money.
• B)It measures net income as a percentage of the sales generated by a project.
• C)It is the best method of analyzing mutually exclusive projects from a financial point of view.
• D)It is the primary methodology used in analyzing independent projects.
• E)It can be compared to the return on assets ratio.

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Definitions:

Government Regulations

Rules and laws established by government agencies to control and guide the operation of businesses and individuals.

Small Businesses

Entities that are privately owned, operate with a small number of employees, and typically have a low volume of sales.

Securing Adequate Financing

The process of obtaining the necessary funds to start or expand operations, typically through loans, equity investments, or other financial instruments.

Small Businesses

Enterprises characterized by a small number of employees and/or low volume of sales, often defined by local or national standards.