RELEVANCE CONCEPT Definition

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RELEVANCE CONCEPT refers to the capacity of accounting information to make a difference to the external decision makers who use financial reports.

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HURDLE RATE is a term used in the budgeting of capital expenditures meaning the REQUIRED RATE OF RETURN in a DISCOUNTED CASH FLOW analysis. If the expected rate of return on an investment is below the hurdle rate, the project is not undertaken. The hurdle rate should be equal to the INCREMENTAL COST OF CAPITAL.

BUSINESS is a commercial or industrial enterprise and the people who constitute it that undertake the activity of providing goods and services involving financial, commercial and industrial aspects.

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