To consider the financial statement effects of leasing versus purchasing an asset, review the following case of Scorecard Corporation Scorecard Corporation needs equipment that will cost the company $240. Scorecard Corporation is considering to either purchase the equipment by borrowing $240 from a local bank or leasing the equipment. Assume that the lease will be structured as an operating lease. Some data from Scortcard Corporation's current batance sheet prior to the lease or purchase of the equipment are: 1. The company's current debt ratio is 2. If the company purchases the equipment by taking a loan, the total debt in the batance sheet will , and the debt ratio will change io 3. If the company leases the equipment, the company's debt ratio will because the lease is not copitalized. 4. In this case, the company's financial risk will be under a lease agreement as compared to the financial risk in purchasing the equipment by taking a loan. 5. However, if the lease is capitalized, the financial risk under the lease agreement will be as compared to the risk in buying the equipment