Using Net Book Values Instead of Gross Book Values to Compute

question 37

True/False

Using net book values instead of gross book values to compute return on investment (ROI)might encourage an investment center manager to delay replacing inefficient assets until they are fully depreciated.

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Definitions:

Contingent

Conditional or dependent on other factors or events, often used in the context of agreements, plans, or strategies that are subject to change.

Environmental Costs

Expenses linked to the negative impact of a company's actions on the environment, including waste management, emissions control, and resource depletion.

External

Factors or influences originating outside a company or organization that can affect its performance and decision-making.

Societal Environmental Cost

A cost associated with environmental degradation or improvement, borne by society as a whole due to economic activities.