A company has two divisions. The divisions are identical in terms of the number and type of machines they have and the operations they carry out. However, one division was set up four years ago and the other was set up one year ago. Head office appraises the division using both return on the investment (ROI) and residual income (RI).

Which of the following statements is correct in relation to the outcome of the appraisal for each division?

A. Both ROI and RI will favour the older division
B. ROI will favour the older division, but RI will treat each fairly
C. RI will favour the newer division and ROI will favour the older division
D. Both RI and ROI will favour the newer division