[amp_mcq option1=”Pay back method” option2=”Accounting rate” option3=”Discounted cash flow” option4=”Present value method” correct=”option2″]<\/p>\n
The correct answer is: B. Accounting rate of return<\/strong><\/p>\n Depreciation is a non-cash expense that is used to allocate the cost of an asset over its useful life. It is included in costs in the accounting rate of return method, which is a method of calculating the profitability of an investment by dividing the annual net income by the average investment.<\/p>\n The accounting rate of return method is a simple and straightforward method of calculating profitability. However, it does not take into account the time value of money, which is the concept that money is worth more today than it will be in the future. This means that the accounting rate of return method may overstate the profitability of an investment.<\/p>\n The other options are incorrect because:<\/p>\n [amp_mcq option1=”Pay back method” option2=”Accounting rate” option3=”Discounted cash flow” option4=”Present value method” correct=”option2″]<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[945],"tags":[],"class_list":["post-46585","post","type-post","status-publish","format-standard","hentry","category-financial-management","no-featured-image-padding"],"yoast_head":"\n\n