Which of the Following Statements Is FALSE

question 4

Multiple Choice

Which of the following statements is FALSE?

• A)Lease payments are a fixed obligation of the firm.
• B)The risk of the lease payments is no greater than the risk of secured debt,so it is reasonable to discount the lease payments at the firm's secured borrowing rate.
• C)If a firm purchases a piece of equipment,the expense is a capital expenditure.Therefore,the purchase price can be depreciated over time,generating a depreciation tax shield.
• D)If the equipment is leased and the lease is a non-tax lease,there is no capital expenditure,but the lease payments are an operating expense.

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Definitions:

Interviewer(s)

Individuals who conduct interviews, often to assess candidates for employment or gather information.

Interview

A formal meeting in which one or more persons question, consult, or evaluate another person.

Situational Interview

A type of job interview where candidates are asked to describe how they would respond to hypothetical job-related scenarios.

Business Details

Specific facts or pieces of information related to the operation, strategies, or background of a company.