Which of the Following Statements Regarding Leases Is False

question 71

Multiple Choice

Which of the following statements regarding leases is false?

• A)Lease agreements are a popular form of financing the purchase of assets because leases do not require a large initial outlay of cash.
• B)Accounting recognizes two types of leases--short- and long-term leases.
• C)If a lessor classifies a lease as a long-term lease, then the lessor records a lease liability on its balance sheet.
• D)If a lease is classified as a short-term lease, the lessee records an asset on its balance sheet.

---

Definitions:

Ethical Investors

Ethical investors focus on investing in companies that adhere to specific ethical or moral guidelines, such as environmental sustainability or social responsibility.

Net Profit

The actual profit after operating expenses, interest, taxes, and depreciation have been deducted from total revenues; it is the bottom line of the income statement.

Shareholder Wealth

The total value of an investment in a company, often measured by the price of the company's stock multiplied by the number of shares owned.

C Corporations

A type of corporation in the U.S. that is taxed separately from its owners.