Q:

Returning object from a Java method

I am trying to understand java programming language better. I believe this statement is true: 
"In order to return an object from a Java method, you must first declare a variable to hold a reference to the object." 
for example: 
public Ball createRedBall() { 

Ball redBall = new Ball("red"); 
return redBall; 
} 

So in this case, Ball is a variable that is a reference to the object. Correct?

A:

You don't have to declare variable. Following works:
public Ball createRedBall() { 
  return new Ball("red");  
} 

So yes, you created an objects but didn't create reference variable for it.

