The failure of Lehman Brothers was due in large part to:
A)Accelerating recording revenue into an earlier period than warranted
B)Understating allowance for loan losses
C)Aggressive valuation of marketable securities
D)Use of Repo 105 transactions

Question

Quizplus · Accepted Answer

The use of Repo 105 transactions allowed Lehman Brothers to temporarily move assets off its balance sheet, making the firm appear less leveraged than it actually was. This contributed significantly to the firm's collapse.

The Failure of Lehman Brothers Was Due in Large Part