Why You Shouldn't Use ToArray or ToList

The IEnumerable(T) extension methods ToList and ToArray are commonly used at boundaries to prevent a potential performance impact from consumers iterating a sequence more than once. This is due to the lazy evaluation strategy used by the LINQ extension methods to IEnumerable(T) which provides better performance as you are constructing your query since each modification to the query is not forcing the sequence to be iterated. However, are these two methods used correctly?