A.Company A will report higher asset balances related to the facilities under construction.
B.The companies will report the same asset balances related to the facilities under construction.
C.Company A’s interest coverage ratio will be lower than it would have been if the company had expensed all interest.
第1题
The effects on a firm’s financial statement in the initial year when cost of an asset is expensed rather than capitalized are:
A.Pre-tax cash flow is lower and the debt-to-equity ratio is higher.
B.Pre-tax cash flow remains the same and the debt-to-equity ratio is lower.
C.Pre-tax cash flow remains the same and the debt-to-equity ratio is higher.
第2题
An analyst has gathered the following information from the current year fixed asset disclosures of three competing companies:
Based on this information, which company is depreciating its building over the longest average period?
A.Company X.
B.Company Y.
C.Company Z.
第3题
Which of the following would most likely be lower in the early years of an asset’s life using accelerated depreciation methods rather than straight-line depreciation?
A.Investing cash flow
B.Shareholder’s equity
C.Cash flow from operations
第4题
A company records an asset retirement obligation (ARO) because of environmental damage.Which of the following will most likely result from the recording an ARO in any given year?
A.An increase in return on equity and an increase in depreciation expense
B.An decrease in return on equity and an increase in depreciation expense
C.An decrease in return on equity and an decrease in depreciation expense
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