Accounting Ratios, Managerial Accounting

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Explain TWO limitations of using accounting ratios to assess the performance of a firm and suggest how each limitation may be improved

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ARR gives a fast estimate of a project's value over its useful life. ARR is derived by determining profits before taxes and interest.   ARR is an accounting technique used fo

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Learning and Spillovers The cost of a value activity can decline over time due to learning that increases its efficiency. The methods by which learning can lower cost over tim

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Ordering Costs These are incurred in getting purchased items into the company’s inventory or stores, and usually consist of clerical costs of: •    Making the purchase demand.

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