Division A has a building with the same original cost as Division B, except that...
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Accounting
- Division A has a building with the same original cost as Division B, except that it was purchased four years before Division B's building. If both divisions have identical operating incomes and use the net book value approach for calculating return on investment (ROI), which of the following will be true?
a. Both divisions will have the same ROI.
b. Division B will have a higher ROI.
c. Division A will have a higher ROI.
d. More information is needed to answer this question.
e. None of the answer choices is correct.
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