Accounting Rate of Return (ARR) | Example 2 | Explained with Example

[@dannylandela8338]

Excellent tutorial

[@greatnessurey9854]

In the case there's no salvage value. What do I do?

[@winnieadhiambo5630]

Hello we have some questions where we're not given given salvage

[@jordanaduncan2895]

i am confused with the question that i have. if the figures i was given are expected profits per annum, do i still calculate depreciation on these figures? and if i am doing so, is it possible to get negative figures? (when calculated, the depreciation is greater than the expected profit figures per annum)...help! :(

[@jordanaduncan2895]

or can i just add all the expected profits per annum and divide by the years to get the av. profit?..and will this include residual value?

[@danielamornortey2346]

What if you were giving cashflow and initial investment and cost of capital in percentage

[@yourgirlstyebrooke]

I always thought Average investment=(initial investment - salvage value)/2

[@Counttuts]

That would be incorrect. Salvage value is added and not subtracted from the initial investment.

[@yourgirlstyebrooke]

Counttuts you are very right... thank you... you are a genius

[@kalindinaidoo5018]

What if you don't get depreciation or scrap value in the question and you only get Cash Flows? How do you calculate Profit?

[@Counttuts]

It depends on what is given in the question. You are most likely given enough information to calculate depreciation.

[@blizz94]

So i have a question, i was given resale value and disposal value, can i get depreciation from that

[@phumlilekhumalo-iz8xg]

What if you haven't been given the depreciation percentage, the how to calculate profits from cash flows

[@aweleogweh5592]

what of if they give you tax rate and you have a mutually exclusive project

[@macdonaldnko6493]

Thank you sir.

[@yourgirlstyebrooke]

But what if you are given tax rate???

[@yourgirlstyebrooke]

Tax rate and cash flows??? We need a tutorial on this please