Leverage or debt ratios measure the degree to which a firm relies on ______. quizlet
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Accounting: What the Numbers Mean9th EditionDaniel F Viele, David H Marshall, Wayne W McManus 338 solutions Essentials of Investments9th EditionAlan J. Marcus, Alex Kane, Zvi Bodie 689 solutions What is the leverage ratio quizlet?Leverage ratio. = total debt / total assets. measure of extent to which debt has financed activities. higher = higher risk of bankruptcy. Times interest earned.
Which type of ratios measure the degree to which a firm relies on borrowed funds to run the operations of its business?Gearing ratios are financial ratios that compare some form of owner's equity (or capital) to debt, or funds borrowed by the company. Gearing is a measurement of the entity's financial leverage, which demonstrates the degree to which a firm's activities are funded by shareholders' funds versus creditors' funds.
What type of ratios measure the degree to which a firm relies on borrowed funds in its operations quizlet?The current ratio is a good indicator of the degree to which a firm relies on borrowed funds in its operations. The current ratio is used to evaluate a firm's ability to pay its short-term debts. You just studied 15 terms!
Which of the following ratio analysis is to measure the extent of a firm uses debt as a source of financing and its ability to service that debt?The debt-to-equity (D/E) ratio indicates how much debt a company is using to finance its assets relative to the value of shareholders' equity. The equity multiplier is a calculation of how much of a company's assets is financed by stock rather than debt. For investors, it is a risk indicator.
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