Disadvantage of leasing from lessee perspective

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Reference no: EM132061363

1. Which of the following is a disadvantage of leasing from a lessee's perspective?

A. ability to avoid restrictive covenants that are normally part of a longminus term loan

B. capability of effectively depreciating land

C. benefit of the salvage value at the end of the term of the lease reverts to the lessor

D. 100 percent debt finacing

2. Which of the following represents an advantage for holding companies?

A. They are easy to analyze for investment purposes.

B. They permit a firm to control a large amount of assets with relatively small dollar investment.

C. They are exempted from double taxation.

D. They are facilitated with reduced federal corporate taxes due to the holding company status.

3. A firm has an outstanding bond with a? $1,000 par value that is convertible at? $40 per share of common stock. The? bond's conversion ratio is? ________.

A. 50

B. 40

C. 25

D. 20

Reference no: EM132061363

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