Using the Information Below Answer the Following Questions

question 4

Multiple Choice

Using the information below answer the following questions:
The operating lease is a 3-year lease commencing on 1 January 2012 with payments of $20 000 on 31 December in each of the 3 years. Assume the lease had been treated as a capital lease instead of an operating lease (using a 12% discount rate the present value of the lease payments is $48036; the company uses straight line depreciation for its capital leases) .
-If the company had recorded the lease as a capital lease instead of an operating lease:

• A) total assets and total liabilities would be higher than under an operating lease
• B) total assets but not total liabilities would be higher than under an operating lease
• C) total liabilities but not total assets would be higher than under an operating lease
• D) total assets and total liabilities would be lower than under an operating lease.

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Definitions:

Moist Environment

A setting with increased moisture levels, often required for wound healing and the growth of certain biological cultures.

Dehiscence

The reopening of a wound after it has been surgically closed, often due to incomplete healing or infection.

Malnutrition/Obesity

A condition that arises from inadequate or imbalanced nutritional intake, leading either to undernourishment or excessive weight gain due to accumulation of body fat.

Use Of Steroids

The medical or recreational use of steroid hormones, either natural or synthetic, to promote muscle growth, reduce inflammation, or treat diseases.