# Accounting Rate of Return (ARR) Calculator

Accounting rate of return, also known as the Average rate of return, or ARR is the percentage of profit during a period from the investment. The period can be of any range based on the users requirement. If total return (revenue - expense including depreciation) over n years is 70\$ out of a total investment of 100\$, then the ARR is 70%.
ARR = Incremental Revenue - Incremental Expenses (Including Depreciation)/Initial Investment

## Find Average Rate of Return

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Accounting rate of return, also known as the Average rate of return, or ARR is the percentage of profit during a period from the investment. The period can be of any range based on the users requirement. If total return (revenue - expense including depreciation) over n years is 70\$ out of a total investment of 100\$, then the ARR is 70%.
ARR = Incremental Revenue - Incremental Expenses (Including Depreciation)/Initial Investment

Code to add this calci to your website  #### Formula:

Depreciation = (Initial Investment - Final Investment) / No. of Years Profit = (Incremental Revenue - Incremental Expenses) / Depreciation ARR = Profit / Initial Investment