Which of the Following Statements Is Incorrect

question 17

Multiple Choice

Which of the following statements is incorrect?

• A)The capitalisation of a leased asset increases the value of reported non-current assets and reduces the return on assets ratio.
• B)Recognition of the present value of future lease payments as a liability increases reported current and non-current liabilities.This favourably affects debt-equity ratios and liquidity- solvency ratios.
• C)Depreciation and interest expenses on finance leases may exceed rental payments and result in lower profits being reported in the early years of the lease.
• D)More onerous disclosure requirements are prescribed for finance leases than for operating leases.

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Definitions:

Cognitive Functioning

Mental processes that involve the ability to learn, think, reason, remember, problem solve, and make decisions.

Psychological Well-Being

A broad concept that includes emotional, mental, and social contentment and health.

Societal Pressures

The expectations or demands placed on individuals by society, which can influence behavior, choices, and perceptions of self and others.

Physical Appearance

The visual attributes of an object or person, including shape, size, color, and overall aesthetic impression.