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opening net assets

This topic has 1 reply, 2 voices, and was last updated 1 year ago by John Moffat.

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July 8, 2021 at 8:54 am #627209
xyzc
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In calculating the residual income and return on investment, should the opening net asset figure be used for calculating the cost of capital or the closing net asset figure
July 8, 2021 at 4:43 pm #627233
John Moffat
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The opening net assets (on the basis that it is they that are earning the profits for the year). Unless, obviously, the question specifies different.
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