Which of the Following Statements Is FALSE

question 19

Multiple Choice

Which of the following statements is FALSE?

• A)Most financial analysts and sophisticated investors consider operating leases (which must be listed in the footnotes of the financial statements)to be additional sources of leverage.
• B)By carefully avoiding the four criteria that define an operating lease for accounting purposes,a firm can avoid listing the long-term lease as a liability.
• C)Because a lease is equivalent to a loan,the firm can increase its actual leverage without increasing the debt-to-equity ratio on its balance sheet.
• D)For most large corporations,the amount of leverage the firm can obtain through a lease is unlikely to exceed the amount of leverage the firm can obtain through a loan.

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Definitions:

Hmos

Health Maintenance Organizations, a type of health insurance plan that provides healthcare services to members through a network of doctors, hospitals, and other healthcare providers.

1998 General Social Survey

An annual survey conducted in the United States to collect data on demographic characteristics, behaviors, attitudes, and opinions of the American population.

Quality Of Medical Care

The degree to which health care services for individuals and populations increase the likelihood of desired health outcomes and are consistent with current professional knowledge.

Illness And Death

Refers to the physical sickness that can lead to the cessation of life.