Accounting Rate of Return Calculator

Enter the total profit registered, years of investment, initial investment, working capital, and scrap value into the calculator. The calculator will determine the accounting rate of return.

Accounting Rate of Return Formula

The following formula is used to calculate the accounting rate of return of an asset or business.

ARR = (RP / YOI) / [(IV + WC + SV)/2] *100

  • Where ARR is the accounting rate of return (%)
  • RP is the registered profit
  • YOI is the years of investment
  • IV is the initial investment
  • WC is the working capital
  • SV is the scrap value

What is an accounting rate of return?

An accounting rate of return is a measure of how profitable any given investment is. It’s more in depth than a typical ROI formula, as it takes into account working capital and scrap value. The higher the ARR the better the investment in 99% of cases.

accounting rate of return calculator

Related Terms

accounting rate of return calculator
accounting rate of return formula
how to calculate accounting rate of return
accounting rate of return
accounting rate of return method
average accounting rate of return
advantages of accounting rate of return
accrual accounting rate of return
accounting rate of return definition
accounting rate of return example
average accounting return calculator
the accounting rate of return
accounting rate
define accounting rate of return
how to find accounting rate of return
meaning of accounting rate of return
annual rate of return formula accounting
irr accounting formula
accounting rate of return example problems
the formula for calculating the accounting rate of return for a capital asset is
average accounting rate of return formula
limitations of accounting rate of return
arr capital budgeting
internal rate of return formula accounting
arr accounting rate of return
arr average rate of return
how to calculate average investment in arr
accrual accounting rate of return formula
accounting rate of return excel
arr average investment
average rate of return method of capital budgeting
example of accounting rate of return
average rate of return in capital budgeting
accounting rate of return equation
average accounting rate
how is accounting rate of return calculated
accounting rate of return problems
how to compute accounting rate of return
accounting rate of return calculation example
accounting rate of return in financial management
accounting rate of return on investment
explain accounting rate of return
unadjusted rate of return calculator
uses and limitations of accounting rate of return and average rate of return