For Many New Firms,the Most Important Reason to Lease Rather

question 106

Multiple Choice

For many new firms,the most important reason to lease rather than buy a facility is

• A)avoidance of a large cash outlay.
• B)freedom in modifying the building.
• C)avoidance of interest payments.
• D)avoidance of liability lawsuits.

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Definitions:

Statement of Comprehensive Income

A financial statement that includes all changes in equity not resulting from interactions with shareholders, in addition to traditional net income.

Statement of Financial Position

A financial statement that shows the assets, liabilities, and equity of a company at a specific point in time, also known as a balance sheet.

Account Receivable

is money owed to a company by its customers for products or services that have been delivered but not yet paid for.

Current Ratio

A financial metric indicating how well a company can settle debts due within one year, determined by dividing current assets by current liabilities.