Which of the following is not an advantage of the accounting rate of return method?

Question

Quizplus · Accepted Answer

The accounting rate of return method does not include the time value of money, which is a major disadvantage of this method. It also ignores the cash flows beyond the initial investment and does not provide a direct measure of the financial performance of the investment. However, it is easy to understand, simple to calculate, and the profit ratio is familiar to managers.

Which of the Following Is Not an Advantage of the Accounting