Essentials Of Investments
11th Edition
ISBN: 9781260013924
Author: Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher: Mcgraw-hill Education,
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Distinguish between operating leases and financial leases. Would a firm be more likely to
finance a fleet of trucks or a manufacturing plant with an operating lease? Explain.
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- Describe some economic factors that might provide an advantageto leasing.arrow_forwardIFRS distinguishes between sales-type and direct financing leases for lessors. True or Falsearrow_forwardA presale agreement is said to be equivalent to a take-out commitment. What will the construction lender be concerned about if the developer plans to use such an agreement in lieu of a take-out?arrow_forward
- The lessor would most likely prefer a ________ or ________ lease to an operating lease. Nonoperating lease treatment would permit a financial service company lessor to remove heavy machinery and equipment, jet airlines, oceangoing vessels, and such from its balance sheet and replace it with the ________, a financial asset compatible with the nature of its business. In addition, the nonoperating lease results in the recognition of ________, rather than ________ revenue. Group of answer choices standalone; operating; fair value of the leased asset; interest income; rent direct financing; operating; net investment in the lease; financing income; unearned standalone price; sales-type; fair value of the leased asset; financing income; unearned direct financing; sales-type; net investment in the lease; interest income; rentarrow_forwardWhy should investors prefer that all significant leases be reportedon the balance sheet?arrow_forwardDefine Short-Term Leases.arrow_forward
- Finance Questionarrow_forwardCompare the benefits and drawbacks to long-term vs. short-term leases from EITHER the point of view of the lessor or the lessee. REAL ESTATE FINANCEarrow_forwardWhy is the reporting of segment information required and who requires it? Why is the reporting of estimates and assumptions required to be given by a company? Why is the reporting of investments and fair value required to be given by a company? Why is the reporting of leases required?arrow_forward
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