Which of the Following Statements Is FALSE

question 5

Multiple Choice

Which of the following statements is FALSE?

• A)The decision to lease is often driven by real-world market imperfections related to leasing's accounting,tax,and legal treatment.
• B)When publicly traded firms disclose leasing transactions in their financial statements,they must follow the recommendations of the Financial Accounting Standards Board (FASB).
• C)In its Statement of Financial Accounting Standards No.13 (FAS13),the FASB provides specific criteria that distinguish a true tax lease from a non-tax lease.
• D)The categories used to report leases on the financial statements affect the values of assets on the balance sheet,but they have no direct effect on the cash flows that result from a leasing transaction.

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Definitions:

Construct Validity

The validity of a test assuming a specific theoretical framework that relates the item the test measures, often rather abstract, to some other item that is more easily assessed. If the two sets of measurements correlate, the test is said to have construct validity.

Theoretical Framework

A foundational structure used to outline possible courses of action or to present a preferred approach to an idea or thought, often used in academic research.

Test Content

The material, topics, or subject matter that is covered by a test, reflecting what the test is designed to measure.

Psychological Assessment

A comprehensive evaluation of an individual’s mental health and behavior using tests, interviews, and observations.