Recording a Long-Term Lease as an Operating Lease, as Opposed $\begin{array} { l c c } &\underline{ \text { Debt to equity} } &\underline{ \text { Total asset turnover }} \\\end{array}$

Recording a long-term lease as an operating lease, as opposed to a capital lease, for a lessee will cause the following ratios to be: $\begin{array} { l c c } &\underline{ \text { Debt to equity} } &\underline{ \text { Total asset turnover }} \\\end{array}$
A. $\begin{array} { l c c } & \text { Higher } &\quad\quad\quad\quad \text { Lower } \\\end{array}$
B. $\begin{array} { l c c } & \text { Higher } &\quad\quad\quad\quad \text { Higher } \\\end{array}$
C. $\begin{array} { l c c } & \text { Lower } &\quad\quad\quad\quad \text { Higher } \\\end{array}$
D. $\begin{array} { l c c } & \text { Lower } &\quad\quad\quad\quad \text { Lower }\end{array}$

A) Option A
B) Option B
C) Option C
D) Option D

Correct Answer:

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