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List , Explain and give advantages and disadvantages of the following methods a.Pay back Period b.Accounting Rate of...

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Finance

List , Explain and give advantages and disadvantages of thefollowing methods

a.Pay back Period

b.Accounting Rate of Return

c.Net Present Value

d.Profitability Index

e.Internal Rate of Return

Answer & Explanation Solved by verified expert
3.8 Ratings (663 Votes)
a Strengths of Payback Period 1 Easy to calculate and less time consuming Weakness 1 It doesnt consider cash flows after Payback period 2 It does not include time value of money b Advantages of ARR 1 It is easy to calculate and to understand also 2 It takes into consideration net income which is ignored by other factors 3 It does not include time value of money    See Answer
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List , Explain and give advantages and disadvantages of thefollowing methodsa.Pay back Periodb.Accounting Rate of Returnc.Net Present Valued.Profitability Indexe.Internal Rate of Return

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