[The following information applies to the questions displayed below.] Early in January 2016, Tellco, Inc., acquired a new machine and incurred $200,000 of interest, installation, and overhead costs that should have been capitalized but were expensed. The company earned net operating income of $1,500,000 on average total assets of $10,000,000 for 2016. Assume that the total cost of the new machine will be depreciated over 10 years using the straight-line method. 23. value: 1.00 points Required information Required: a. Calculate the ROI for Tellco. Inc., for 2016. ROI % 26. value: 1.00 points d. Assuming that the $200,000 is capitalized, what will be the effect on ROI for 2017 and subsequent years, compared to expensing the interest, installation, and overhead costs in 2016? O In 2017 and subsequent years, ROI will be higher. O In 2017 and subsequent years, ROI will not be affected. O In 2017 and subsequent years, ROI will be lower. References eBook & Resources b. Calculate the ROI for Tellco, Inc., for 2016, assuming that the $200,000 had been capitalized and depreciated over 10 years using the straight-line method. (Hint: There is an effect on net operating income and average assets.) (Round your answ ROI % References eBook & Resources Worksheet Learning Objective: 06-02 Discuss how the terms capitalize and expense are used with respect to property, plant, and equipment. Difficulty: 3 Hard Learning Objective: 06-04 Describe the accounting treatment of repair and maintenance expenditures. value 1.00 points c. Given your answers to part a and b, why would the company want to account for this expenditure as an expense? (Select all that apply.) Expensing an item immediately increases company's net profit. Less time, effort and cost is spent for accounting purposes. Expensing an item immediately reduces the company's tax expense in the future. Expensing an item immediately reduces the company's tax expense. Expensing an item immediately increases a company's future ROI