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Bezzdna [24]
4 years ago
9

Star Corp. has a rate of return on assets of 10% and a debt/equity ratio of 2 to 1 before entering into an operating lease. Not

including any indirect effects on earnings, when Star Corp. records the operating lease, the immediate impact on these ratios is a(an):
Business
1 answer:
Fynjy0 [20]4 years ago
3 0

Answer:

The return on assets and debt/equity ratio does not change

Explanation:

An operating lease does not affect assets and liabilities. From the formula:

Equity = Assets - Liabilities, since both assets and liabilities are not affected (they remain unchanged) therefore the equity is also the same.

The debt/ equity ratio = total liabilities/total equity. Since liabilities and equity remain unchanged, therefore The debt/ equity ratio is the same.

Also the return of assets (earnings/assets) remain the same

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Answer: Option B

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Hence from the above we can conclude that the correct option is B.

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3 years ago
oselli Animation plans to offer its employees a salary enhancement package that has revenue sharing as its main component. Speci
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Answer:

Answer for the question:

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Explanation:

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3 years ago
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If an investor does not diversify his portfolio and instead puts all of his money in one stock, the appropriate measure of secur
Lady_Fox [76]

If an investor does not diversify his portfolio and instead puts all of his money in one stock, the appropriate measure of security risk for that investor is the "stock's standard deviation."

<h3>What is standard deviation?</h3>

The standard deviation would be a statistic that calculates as square root of a variance and indicates the dispersion of the a dataset compared to its mean.

Its standard deviation is determined as the square root of the variance by determining the deviation of each data point from the mean.

Some key features regarding the  standard deviation, are-

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  • A square root of a variance is used to compute it.
  • In finance, standard deviation is frequently employed as a measurement of an asset's relative riskiness.
  • The volatile stock has a large standard deviation, whereas a description stock has a low deviation.
  • The standard deviation, on the other hand, assesses all ambiguity as risk, especially when it is in the investor's advantage, such as above-average profits.

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7 0
1 year ago
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storchak [24]

Answer:

<u>$0 (None)</u>

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