Reference no: EM132513883

Problem 1: While managers are able to manipulate earnings to present more favorable results on the income statement, it is impossible for managers to manipulate the statement of cash flows.

True
False

Problem 2: A legitimate reason why a manufacturer may experience an increase in its Inventory Turnover ratio is that the firm has switched to a just-in-time inventory system in which fewer items are stocked in inventory.

True
False

Problem 3: In the first year of a lease, a company will report higher expenses if the lease is classified as a financing lease than if it is classified as an operating lease.

True
False

Problem 4: Operating leases are often a preferred over financing leases because they are not reflected on the Balance Sheet.

True
False

Problem 5: The DuPont analysis disaggregates return on assets to interpret whether the company is earning income through margins, use of assets, or the balance of debt and equity.

True
False