1. Differences in accounting practices can lead to comparability problems in all of the following cases except ________________.
accounting for inventory
accounting for depreciation
setting aside reserves for future contingencies
All of the above
2. Accounting standards in foreign countries often differ from accounting standards in the USA with respect to __________.
depreciation
reserving practices
treatment of intangibles
all of the above
3. If the interest rate on debt is higher than the ROA, then a firm will __________ if it increases the use of debt in its capital structure.
decrease its ROE
increase its ROE
not change its ROE
change its ROE in an indeterminable manner