Heavy use of off-balance-sheet lease financing will tend to
A. make a company appear more risky than it actually is because its stated debt ratio will be increased.
B. make a company appear less risky than it actually is because its stated debt ratio will appear lower.
C. affect a company's cash flows but not its degree of risk.
D. have no effect on either cash flows or risk because the cash flows are already reflected in the income statement.
E. affect the lessee's cash flows but only due to tax effects.
Answer: B
You might also like to view...
To compute departmental operating income, it is necessary to determine the gross profit and the operating expenses of each department
a. True b. False Indicate whether the statement is true or false
Which of the following is not an element of bureaucratic control?
A) rules B) exchange relationships C) authority D) budgets E) performance appraisals
Fabricators, Inc. wants to increase capacity by adding a new machine. The fixed costs for machine A are $90,000, and its variable cost is $15 per unit. The revenue is $21 per unit. What is the break-even point for machine A?
A) $90,000 dollars B) 90,000 units C) $15,000 dollars D) 15,000 units E) 4,286 units
Which of the following is not a measure of dispersion?
a. Mean absolute deviation b. Quantiles c. Weighted mean d. Range e. Standard deviation.