Which of the Following Is a Reason a Company Would

question 133

Multiple Choice

Which of the following is a reason a company would prefer an operating lease over purchasing an asset?

• A) The company's ability to borrow increases due to larger assets.
• B) The company benefits from the increase in value of the assets.
• C) The risk of loss from obsolescence is reduced.
• D) The company does not have to depreciate the asset.

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Definitions:

Pictorial Sketching

Pictorial sketching is the artistic process of creating a three-dimensional representation of an object on a two-dimensional surface, offering a realistic view that helps in understanding the object's shape.

Oblique Cabinet

Oblique Cabinet is a type of pictorial drawing technique in which an object's front face is drawn true size, but other surfaces are receded at an angle, typically to render depth.

Perspective

A drawing or representation technique that illustrates dimensions through a particular viewpoint, giving depth and spatial relationships.

Isometric Sketch

A method of graphical representation allowing the visualization of three-dimensional objects in two dimensions, where the three axes appear equally foreshortened and the angles between them are 120 degrees.