Which ratio does not focus on financial leverage?
A) Total debt ratio.
B) Debt/equity ratio.
C) Equity multiplier.
D) Times interest earned.
E) Cash ratio.

Question

Quizplus · Accepted Answer

The cash ratio focuses on a company's ability to pay off its short-term liabilities with its cash and cash equivalents, rather than on financial leverage, which is concerned with the use of debt to finance a company's operations.

Which Ratio Does Not Focus on Financial Leverage