This scenario describes a tax system. Isabel pays Tony and Juan on the computer. pays the highest tax rate on the computer. woul
1 answer:
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Answer:
a. emphasizes accounting income
Explanation:
Average rate of return is calculated using annual returns, for the period for which the investment is made.
The formula to calculate so =
Where average return during the period = total of return during the entire life of the investment divided into number of years, or tenure of investment.
Average investment = (Opening investment + Closing investment)/2.
Therefore it does not consider the accounting income, it takes into consideration, it considers total return from each particular investment.
Thus emphasizing on accounting income is not an advantage of average rate of return method.