Question: Special purpose entities (SPE), if structured correctly, and operating leases are example of off-balance sheet financing. T F Ability to pay its debts as they

Special purpose entities (SPE), if structured correctly, and operating leases are example of off-balance sheet financing. T F

Ability to pay its debts as they mature and adequate capital are better indicates of a companys solvency than if the companys total assets > total liabilities. T F

Concerning a short-term zero-interest liability on the balance sheet, the difference between the cash the borrower received and the obligation the borrower must pay is a premium. T F

Bond price is the present value of the promised bond cash flows at the market rate of interest. T F

Bond premium results when the bond coupon interest rate is < the market rate of interest. T F

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