1. ‘Average useful life’, ‘Average age of PPE assets’ and ‘Asset Turnover’ are three measures that decision makers can use to analyse the PPE (Property, Plant & Equipment) assets of entities. Fresh Food Ltd and Cheap Food Ltd operate in the same industry. Each entity depreciates its PPE (Property, Plant & Equipment) assets using the straight line approach. An investigation of their financial statements reveals the following information:

    (Amounts in millions)
    Fresh Food Ltd Cheap Food Ltd
    Sales $ 22,653 $ 33,812
    Total Assets (Average) 22,088 36,167
    Accumulated Depreciation 2,701 4,359
    Depreciation Expense 381 697
    Cost of Plant Assets (Average) 7,715 10,237


    What conclusion concerning the management of plant assets can be drawn from these data? (word limit: 180 – 240 words)