Asked by
Prachi Patel
on Nov 07, 2024
Verified
The AAR is based on cash flows and market values.
Average Accounting Return
A financial ratio that measures the average net income that a firm generates as a percentage of its average book value of equity.
Market Values
The existing selling or buying price for assets or services in the marketplace.
- Recognize the basis of average accounting return (AAR) calculations and their implications for investment decisions.
Verified Answer
GC
Learning Objectives
- Recognize the basis of average accounting return (AAR) calculations and their implications for investment decisions.
Related questions
Average Accounting Return Employs Some Sort of Arbitrary Value Against ...
A Disadvantage with the Average Accounting Return Is the Accounting ...
AAR Is Biased in Favour of Liquid Investments
Which of the Following Is Considered to Be a Redeeming ...
An Investment's Average Net Income Divided by Its Average Book ...