Which of the Following Statements Regarding Capital Leases Is FALSE

question 37

Multiple Choice

Which of the following statements regarding capital leases is FALSE?

• A)Because capital leases increase the apparent leverage on the firm's balance sheet,firms sometimes prefer to have a lease categorized as an operating lease to keep it off the balance sheet.
• B)The firm does not report the present value of the future lease payments as a liability on the balance sheet.
• C)The asset acquired is listed on the lessee's balance sheet,and the lessee incurs depreciation expenses for the asset.
• D)They are viewed as an acquisition for accounting purposes.

---

Definitions:

Political Implications

The potential effects or consequences of actions, policies, or decisions on the political landscape.

Provider Credibility

The perceived trustworthiness and expertise of a service provider, which can affect the willingness of individuals to engage with and accept the services offered.

Cultural Perspective

The viewpoint that reflects beliefs, values, and practices stemming from one's cultural background.

Immediate Benefit

The direct and prompt advantage gained from a particular action or decision.