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17 10 points 011813 Why would some people argue that you should use the gross (rather than the net) cost of plant and equipment
17 10 points 011813 Why would some people argue that you should use the gross (rather than the net) cost of plant and equipment when calculating operating assets as part of your return on investment (RO) computations? Multiple Choice Using gross cost means that the plant and equipments age would not affect the return on investment (RO) computations Using gross cost is more consistent with how net operating income is calculated, since depreciation is considered an operating expense Using gross cost would discourage management from replacing older equipment because of the effect on the return on investment (RO) computations Using gross cost is more consistent with how plant and equipment are presented on the balance sheet
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