Which of the Following Is Not a "Con" of the Accounting

question 7

Multiple Choice

Which of the following is not a "con" of the Accounting Rate of Return method?

• A) The method makes no adjustment for the time value of money or project risk.
• B) The depreciation method used impacts both the numerator and denominator.
• C) It focuses on net income rather than a company's ability to generate cash.
• D) The choice of the hurdle rate is arbitrary.
• E) All of the above are cons of the Accounting Rate of Return method.

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Definitions:

Reduced

A term often used in chemistry to describe the gain of electrons or decrease in oxidation state by a molecule, atom, or ion.

Oxidized

Describes a process where an atom, molecule, or ion loses electrons, often associated with a gain of oxygen or loss of hydrogen in chemical reactions.

Photophosphorylation

The production of ATP in photosynthesis.

ATP Synthesis

The metabolic process by which cells produce ATP (adenosine triphosphate), the primary molecule used by cells for energy transfer.