DQ #1 Compare and contrast compensation plans, such as restricted stock and stock appreciation rights, indicating the key differences with the accounting treatment. Determine the option that would have the least impact on a company's earnings.

DQ #2 The debt to equity ratio is often relied upon by lenders and creditors as a measure of the riskiness of a company. Are there any issues that should be considered when relying on this ratio?

DQ #3 Stakeholders of a company must be aware of the limitations of relying on any specific ratio. Select any ratio and briefly (4-5 sentences) discuss some limitations to the use of this ratio.

DQ #4 Financial leverage is generally defined as the use of borrowed funds to increase profits. Financial risk is more broadly defined to include the risk of default. What is the relationship, if any, between financial risk and financial leverage?