Accounting rate of return

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Accounting rate of return (ARR) is a measure of profitability computed by dividing the average annual operating income from an asset by the initial investment in the asset.

Definitions

According to Managerial Accounting by Braun, Tietz (5th edition),

Accounting rate of return (ARR). A measure of profitability computed by dividing the average annual operating income from an asset by the initial investment in the asset.
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