Lease Obligations Are Included in Certain Leverage Ratios Because Leases

question 94

Multiple Choice

Lease obligations are included in certain leverage ratios because leases:

• A) require the payment of interest.
• B) represent long-term fixed obligations.
• C) must be financed through a bank.
• D) are perpetual obligations.

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Definitions:

Financial Institutions

Organizations that provide financial services, such as banks, credit unions, and insurance companies.

Tax Agencies

Governmental organizations responsible for the administration and collection of taxes and enforcement of tax laws.

Inventory Suppliers

These are the entities or individuals from whom a business purchases its inventory, comprising goods intended for sale.

Vendors Section

The part of a business's accounting or procurement software where information about suppliers, including payments and contracts, is managed.