Average accounting Return Formula





Average net income = (Net income of 1st year or period+Net income of 2nd year or period+.+.+...) / No. of years or periods


Average book value = (Initial book value of the assets or investment + Ending book value of the assets or investment) / 2



Description:

Average accounting Return is Some measure of average accounting profit divided by Some measure of average accounting value 

A project is acceptable if its average accounting return exceeds a target average accounting return—