Assume that you have just been employed at Southern Coast Wealth Foods as an assistant and you are concerned with the high level of reliance on PCI to evaluate and compare the performance of the three divisions of the company.
You are aware that one division has assets that it purchased 10 years ago, and they now replacement; the second division acquired its assets only three years ago; and the third division is the most profitable division and has relatively few assets.
Write a memo outlining any issues that you see with this situation. You might like to refer to Exhibit 13.2 to support your arguments.