Since Operating Leases Result in the Receipt of Services from an Asset

question 79

True/False

Since operating leases result in the receipt of services from an asset without increasing the assets or liabilities on the firm's balance sheet, leasing may result in misleading financial ratios.

---

Definitions:

CISG

The United Nations Convention on Contracts for the International Sale of Goods, a treaty that establishes a uniform framework for international commerce.

Globalized New World Order

A concept or perspective on the shifting dynamics of global power, economics, and politics towards increased interconnectedness and homogenization across countries and cultures, often discussed with both positive and negative connotations.

Nation-State

A sovereign entity characterized by a defined territory, permanent population, a government, and the capacity to enter into relations with other states.

Most-Favored Nation Principle

The Most-Favored Nation Principle is a trade policy requiring that a country extends the same trade terms and lowest tariffs it offers to one trading partner to all others.