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It is precise and objective.
Data for calculating the return are typically readily available.
The method explicitly adjusts for the time value of money.
The accounting rate of return is generally approximately equal
to a project's internal rate of return (IRR).
Question 8. Question : Which one of the following statements
concerning capital
budgeting is not true?
Student Answer:
A basic objective underlying capital budgeting is to select
assets that will earn a satisfactory return.
Capital budgeting is the process of identifying, evaluating,
selecting, and controlling long-term investment projects.
Capital budgeting is based on precise estimates of future
events.
Capital budgeting involves estimating the revenues and costs
of each proposed project, evaluating their merits, and choosing