Driscoll Dispos-all is a waste disposal company. Its management has done the following: Assigned unsupported and inflated salvage values and extended the useful lives of company garbage trucks. Assigned arbitrary salvage values to other assets that previously had not salvage value Did not record expenses required to write off the costs of unsuccessful and abandoned landfill development projects Improperly capitalized a variety of expenses. Did not establish sufficient liabilities for income taxes and other expenses. 7-7. Explain the effect these actions would have had on Driscoll's reported earnings and its balance sheet. What impact would this have on ratio analysis? Consider specifically current ratio, return on assets, return on equity, profit margin on sales. debt-to-asset ratio. See page 232 in Chapter 5 Appendix 5A. Would there be any impact on CFFO? 7-8. 7-9. What motivations could have driven management to engage in these actions? WHY? 7-10. To identify these tricks, at what relationships could you examine in the comparative financial statements and notes? 7-11 Which external stakeholders would be affected by this earnings manipulation and WHY