标题: Question about CFA L2 FRA: Long-lived Asset, Schweser note 2014 P.56 [打印本页] 作者: lawkm223 时间: 2014-3-2 19:22 标题: Question about CFA L2 FRA: Long-lived Asset, Schweser note 2014 P.56
For the Schweser Notes 2014 of FRA, example on P.56, part B, the question asked the effects on the debt-to-equity ratio if one treated the operating leases as finance leases. For the answer, adjusted debt-to-equity ratio= (reported debt+ PV of operating lease)/ reported equity=(2950+509)/800. I wonder if the equity shd hv changed or not becoz once it is a finance lease, the N.I. will be lower in early years and thus affect the stockholder's equity (Retained Earnings). Am I in the right track?作者: mophic 时间: 2014-3-3 07:20
you 're right holding other things unchanged, but the example only asked u the balance sheet impact at the inception of the financial lease, which means an instant adjustment to the changing of accounting method作者: lawkm223 时间: 2014-3-4 22:21
Thz for answering however i found quite a no. of mistakes in Schweser notes@@
